Summary Of Significant Accounting Policies

Summary of significant accounting policies

(1) Accounting estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from these estimates. Significant estimates impacting the consolidated financial statements include accruals that have been established for contingent liabilities, pending claims and legal actions arising in the normal course of business, useful lives of property, plant and equipment, residual values of tanks, capitalization of customer tank installation costs, amortization methods of intangible assets, valuation methods used to value sales returns and allowances, allowance for doubtful accounts, fair value of reporting units, recoverability of long-lived assets, assumptions used to value business combinations, fair values of derivative contracts and stock-based compensation calculations.

(2) Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas Partners, its wholly-owned subsidiary, Ferrellgas Partners Finance Corp., and the operating partnership, its majority-owned subsidiary, after elimination of all intercompany accounts and transactions. The accounts of Ferrellgas Partners’ majority-owned subsidiary are included based on the determination that the operating partnership is a variable interest entity for whom Ferrellgas Partners has no ability through voting rights or similar rights to make decisions and thus does not have the power to direct the activities of the operating partnership that most significantly impact economic performance. However, we have determined that Ferrellgas Partners is most closely associated with the operations of the operating partnership because Ferrellgas Partners has the obligation to absorb the losses of and the right to receive benefits from the operating partnership that are significant to the operating partnership and substantially all the assets and liabilities of Ferrellgas Partners consist of the operating partnership. The operating partnership includes the accounts of its wholly-owned subsidiaries. The general partner’s approximate 1% general partner interest in the operating partnership is accounted for as a noncontrolling interest. The wholly-owned consolidated subsidiary of the operating partnership, Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), is a special purpose entity that has agreements with the operating partnership to securitize, on an ongoing basis, a portion of its trade accounts receivable.

(3) Fair value measurements: Ferrellgas measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.

The common framework for measuring fair value utilizes a three-level hierarchy to prioritize the inputs used in the valuation techniques to derive fair values. The basis for fair value measurements for each level within the hierarchy is described below with Level 1 having the highest priority and Level 3 having the lowest.


•	Level 1: Quoted prices in active markets for identical assets or liabilities.


•	Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.


•	Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

(4) Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

(5) Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

(6) Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

(7) Goodwill: Ferrellgas records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2018, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit's recorded amount of goodwill. Ferrellgas completed its most recent annual goodwill impairment test on January 31, 2018 and recorded an impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment.

During the quarter ended January 31, 2017, Ferrellgas adopted ASU 2017-04, which as discussed below eliminated step 2 from the goodwill impairment test. As discussed in Note C – Asset impairments, during 2016 Ferrellgas recorded impairments under the old model prior to adoption of ASU 2017-04.

(8) Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

(9) Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Ferrellgas’ overall objective for entering into commodity based derivative contracts, including commodity options and swaps, is to hedge a portion of its exposure to market fluctuations in propane, gasoline and diesel prices.

Ferrellgas’ risk management activities primarily attempt to mitigate price risks related to the purchase, storage, transport and sale of propane generally in the contract and spot markets from major domestic energy companies on a short-term basis. Ferrellgas attempts to mitigate these price risks through the use of financial derivative instruments and forward propane purchase and sales contracts. Additionally, from time to time Ferrellgas risk management activities attempt to mitigate price risks related to the purchase of gasoline and diesel fuel for use in the transport of propane from retail fueling stations through the use of financial derivative instruments.

Ferrellgas’ risk management strategy involves taking positions in the forward or financial markets that are equal and opposite to Ferrellgas’ positions in the physical products market in order to minimize the risk of financial loss from an adverse price change. This risk management strategy is successful when Ferrellgas’ gains or losses in the physical product markets are offset by its losses or gains in the forward or financial markets. The propane related financial derivatives are designated as cash flow hedges. The gasoline and diesel related financial derivatives have not historically been formally designated and documented as a hedge of exposure to fluctuations in the market price of fuel.

Ferrellgas’ risk management activities may include the use of financial derivative instruments including, but not limited to, swaps, options, and futures to seek protection from adverse price movements and to minimize potential losses. Ferrellgas enters into these financial derivative instruments directly with third parties in the over-the-counter market and with brokers who are clearing members with the New York Mercantile Exchange. All of Ferrellgas’ financial derivative instruments are reported on the consolidated balance sheets at fair value.

Ferrellgas also enters into forward propane purchase and sales contracts with counterparties. These forward contracts qualify for the normal purchase normal sales exception within GAAP guidance and are therefore not recorded on Ferrellgas’ financial statements until settled.

On the date that derivative contracts are entered into, other than those designated as normal purchases or normal sales, Ferrellgas makes a determination as to whether the derivative instrument qualifies for designation as a hedge. These financial instruments are formally designated and documented as a hedge of a specific underlying exposure, as well as the risk management objectives and strategies for undertaking the hedge transaction. Because of the high degree of correlation between the hedging instrument and the underlying exposure being hedged, fluctuations in the value of the derivative instrument are generally offset by changes in the anticipated cash flows of the underlying exposure being hedged. Since the fair value of these derivatives fluctuates over their contractual lives, their fair value amounts should not be viewed in isolation, but rather in relation to the anticipated cash flows of the underlying hedged transaction and the overall reduction in Ferrellgas’ risk relating to adverse fluctuations in propane prices. Ferrellgas formally assesses, both at inception and at least quarterly thereafter, whether the financial instruments that are used in hedging transactions are effective at offsetting changes in the anticipated cash flows of the related underlying exposures. Any ineffective portion of a financial instrument’s change in fair value is recognized in “Cost of product sold - propane and other gas liquids sales” in the consolidated statements of operations. Financial instruments formally designated and documented as a hedge of a specific underlying exposure are recorded gross at fair value as either “Prepaid expenses and other current assets”, "Other assets, net", “Other current liabilities”, or "Other liabilities" on the consolidated balance sheets with changes in fair value reported in other comprehensive income.

Financial instruments not formally designated and documented as a hedge of a specific underlying exposure are recorded at fair value as “Prepaid expenses and other current assets”, "Other assets, net", “Other current liabilities”, or "Other liabilities" on the consolidated balance sheets with changes in fair value reported in "Operating expense" on the consolidated statements of operations.

Interest Rate Risk.

Fluctuations in interest rates subject Ferrellgas to interest rate risk. Decreases in interest rates increase the fair value of Ferrellgas’ fixed rate debt, while increases in interest rates subject Ferrellgas to the risk of increased interest expense related to its variable rate borrowings.

Ferrellgas may enter into fair value hedges to help reduce its fixed interest rate risk. Interest rate swaps may be used to hedge the exposure to changes in the fair value of fixed rate debt due to changes in interest rates. Fixed rate debt that has been designated as being hedged is adjusted to offset the change in the fair value of interest rate derivatives that are fair value hedges, which are classified as “Prepaid expenses and other current assets”, “Other assets, net”, Other current liabilities” or as “Other liabilities” on the consolidated balance sheets. Changes in the fair value of fixed rate debt and any related fair value hedges are recognized as they occur in “Interest expense” on the consolidated statements of operations.

Ferrellgas may enter into cash flow hedges to help reduce its variable interest rate risk. Interest rate swaps are used to hedge the risk associated with rising interest rates and their effect on forecasted interest payments related to variable rate borrowings. These interest rate swaps are designated as cash flow hedges. Thus, the effective portions of changes in the fair value of the hedges are recorded in “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities” or as “Other liabilities” with an offsetting entry to “Other comprehensive income” at interim periods and are subsequently recognized as interest expense in the consolidated statement of earnings when the forecasted transaction impacts earnings. Changes in the fair value of any cash flow hedges that are considered ineffective are recognized as interest expense on the consolidated statement of operations as they occur.

(10) Revenue recognition: Revenues from Ferrellgas' propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Prior to the dispositions in 2018 which constituted Ferrellgas' Midstream operations segment, revenues included crude oil sales, pipeline tariffs, trucking fees, rail throughput fees, pipeline management services, leasing, throughput, storage and salt water disposal. These revenues were recognized upon completion of the related service or delivery of product.

(11) Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas are classified within “Equipment lease expense.”

See Note F – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

(12) Cost of sales: “Cost of sales – propane and other gas liquids sales” includes all costs to acquire propane and other gas liquids, the costs of storing and transporting inventory prior to delivery to Ferrellgas’ customers, the results from risk management activities to hedge related price risk and the costs of materials related to the refurbishment of Ferrellgas’ portable propane tanks. "Cost of sales - midstream operations" included all costs incurred to purchase and transport crude oil, including the costs of terminaling and transporting crude oil prior to delivery to customers and the costs of salt water disposal. “Cost of sales – other” primarily includes costs related to the sale of propane appliances and equipment.

(13) Operating expense: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

(14) General and administrative expenses: “General and administrative expense” primarily includes personnel and incentive expense related to executives and employees, as well as other overhead expenses related to centralized corporate functions.

(15) Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

The ICPs are not Ferrellgas stock-compensation plans; however, in accordance with Ferrellgas’ partnership agreements, all Ferrellgas employee-related costs incurred by Ferrell Companies are allocated to Ferrellgas. As a result, Ferrellgas incurs a non-cash compensation charge from Ferrell Companies. During the years ended July 31, 2018, 2017 and 2016, the portion of the total non-cash compensation charge relating to the ICPs was $0.0 million, $3.3 million and $9.3 million, respectively.

Ferrell Companies is authorized to issue up to 9.25 million stock appreciation rights (“SARs”) that are based on shares of Ferrell Companies common stock. The SARs were established by Ferrell Companies to allow upper-middle and senior level managers as well as directors of the general partner to participate in the equity growth of Ferrell Companies. The SARs awards vest ratably over periods ranging from zero to 10 years or 100% upon a change of control of Ferrell Companies, or upon the death, disability or retirement at the age of 65 of the participant. All awards expire 10 years from the date of issuance. The fair value of each award is estimated on each balance sheet date using a binomial valuation model.

(16) Income taxes: Ferrellgas Partners is a publicly-traded master limited partnership with one subsidiary that is a taxable corporation. The operating partnership is a limited partnership with three subsidiaries that are taxable corporations. Partnerships are generally not subject to federal income tax, although publicly-traded partnerships are treated as corporations for federal income tax purposes and therefore subject to Federal income tax unless a qualifying income test is satisfied. If this qualifying income test is satisfied, the publicly-traded partnership will be treated as a partnership for Federal income tax purposes. Based on Ferrellgas’ calculations, Ferrellgas Partners satisfies the qualifying income test. As a result, except for the taxable corporations, Ferrellgas Partners’ earnings or losses for Federal income tax purposes are included in the tax returns of the individual partners, Ferrellgas Partners’ unitholders. Accordingly, the accompanying consolidated financial statements of Ferrellgas Partners reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to Ferrellgas Partners unitholders as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas Partners’ partnership agreement and differences between Ferrellgas Partners' financial reporting year end and its calendar tax year end.

Income tax benefit consisted of the following:



	For the year ended July 31,
	2018			2017			2016
Current expense (benefit)	$	1,140		$	(1,154	)	$	468
Deferred expense (benefit)	(3,818		)	11			(504		)
Income tax benefit	$	(2,678	)	$	(1,143	)	$	(36	)

Deferred taxes consisted of the following:



	July 31,
	2018			2017
Deferred tax assets (included in Other assets, net in 2018 and Prepaid expenses and other current assets in 2017)	$	715		$	1,068
Deferred tax liabilities (included in Other liabilities)	(16		)	(4,186		)
Net deferred tax asset (liability)	$	699		$	(3,118	)

(17) Sales taxes: Ferrellgas accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

(18) Net loss per common unitholders’ interest: Net loss per common unitholders’ interest is computed by dividing “Net loss attributable to Ferrellgas Partners, L.P.,” after deducting the general partner's 1% interest, by the weighted average number of outstanding common units and the dilutive effect, if any, of outstanding unit options. See Note P – Net loss per common unitholders’ interest – for further discussion about these calculations.

(19) Loss contingencies: In the normal course of business, Ferrellgas is involved in various claims and legal proceedings. Ferrellgas records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

(20) New accounting standards:

FASB Accounting Standard Update No. 2014-09

In May 2014, the Financial Accounting Standards Board, ("FASB") issued Accounting Standard Update ("ASU") 2014-09, Revenue from Contracts with Customers. The issuance is part of a joint effort by the FASB and the International Accounting Standards Board ("IASB") to enhance financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards ("IFRS") and, thereby, improving the consistency of requirements, comparability of practices and usefulness of disclosures. The new standard will supersede much of the existing authoritative literature for revenue recognition. The standard and related amendments will be effective for Ferrellgas for its annual reporting period beginning August 1, 2018, including interim periods within that reporting period. Entities are allowed to transition to the new standard by either recasting prior periods or recognizing the cumulative effect. Ferrellgas has completed its assessment of its contracts with customers and impacts to revenue recognition under the new guidance. When Ferrellgas adopts the new guidance, which will be August 1, 2018, the impact will not be material to its consolidated financial statements. Ferrellgas will utilize the modified retrospective transition method, which recognizes the cumulative effect upon adoption, when it adopts the new standard.

FASB Accounting Standard Update No. 2016-02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability

among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Ferrellgas is currently evaluating the impact of its pending adoption of ASU 2016-02 on the consolidated financial statements. Ferrellgas has formed an implementation team, completed training on the new standard, and is working on an initial assessment.

FASB Accounting Standard Update No. 2016-13

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. This standard is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Ferrellgas is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

FASB Accounting Standard Update No. 2017-12

In August 2017, the FASB issued ASU 2017-12, Financial Instruments - Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities, which is intended to improve the financial reporting for hedging relationships to better portray the economic results of an entity's risk management activities in its financial statements. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Ferrellgas, L.P. is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

Summary Of Significant Accounting Policies

Summary of significant accounting policies

(2) Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas, L.P. and its subsidiaries after elimination of all intercompany accounts and transactions. Ferrellgas, L.P. consolidates the following wholly-owned entities: Bridger Logistics, LLC, Sable Environmental, LLC, Sable SWD 2, LLC, Blue Rhino Global Sourcing, Inc., Blue Rhino Canada, Inc., Ferrellgas Real Estate, Inc., Ferrellgas Finance Corp. and Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), a special purpose entity that has agreements with Ferrellgas, L.P. to securitize, on an ongoing basis, a portion of its trade accounts receivable.

(3) Fair value measurements: Ferrellgas, L.P. measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.


•	Level 1: Quoted prices in active markets for identical assets or liabilities.


•	Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.


•	Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

(4) Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas, L.P. has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

(5) Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

(6) Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas, L.P. capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, L.P., using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas, L.P. management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the assets.

(7) Goodwill: Ferrellgas, L.P. records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas, L.P. tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas, L.P. has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2018, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit's recorded amount of goodwill. Ferrellgas, L.P. completed its most recent annual goodwill impairment test on January 31, 2018 and recorded an impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment.

During the quarter ended January 31, 2017, Ferrellgas, L.P. adopted ASU 2017-04, which as discussed below eliminated step 2 from the goodwill impairment test. As discussed in Note C – Asset impairments, during 2016 Ferrellgas, L.P. recorded impairments under the old model prior to adoption of ASU 2017-04.

(8) Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements, permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas, L.P. tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas, L.P. tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas, L.P. management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the assets.

(9) Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Ferrellgas, L.P.’s overall objective for entering into commodity based derivative contracts, including commodity options and swaps, is to hedge a portion of its exposure to market fluctuations in propane, gasoline and diesel prices.

Ferrellgas, L.P's risk management activities primarily attempt to mitigate price risks related to the purchase, storage, transport and sale of propane generally in the contract and spot markets from major domestic energy companies on a short-term basis. Ferrellgas, L.P attempts to mitigate these price risks through the use of financial derivative instruments and forward propane purchase and sales contracts. Additionally, from time to time Ferrellgas, L.P.'s risk management activities attempt to mitigate price risks related to the purchase of gasoline and diesel fuel for use in the transport of propane from retail fueling stations through the use of financial derivative instruments.

Ferrellgas, L.P.’s risk management strategy involves taking positions in the forward or financial markets that are equal and opposite to Ferrellgas, L.P.’s positions in the physical products market in order to minimize the risk of financial loss from an adverse price change. This risk management strategy is successful when Ferrellgas, L.P.’s gains or losses in the physical product markets are offset by its losses or gains in the forward or financial markets. These financial derivatives are designated as cash flow hedges. The gasoline and diesel related financial derivatives have not historically been formally designated and documented as a hedge of exposure to fluctuations in the market price of fuel.

Ferrellgas, L.P.’s risk management activities may include the use of financial derivative instruments including, but not limited to, swaps, options, and futures to seek protection from adverse price movements and to minimize potential losses. Ferrellgas, L.P. enters into these financial derivative instruments directly with third parties in the over-the-counter market and with brokers who are clearing members with the New York Mercantile Exchange. All of Ferrellgas, L.P.’s financial derivative instruments are reported on the consolidated balance sheets at fair value.

Ferrellgas, L.P. also enters into forward propane purchase and sales contracts with counterparties. These forward contracts qualify for the normal purchase normal sales exception within GAAP guidance and are therefore not recorded on Ferrellgas, L.P.’s financial statements until settled.

On the date that derivative contracts are entered into, other than those designated as normal purchases or normal sales, Ferrellgas, L.P. makes a determination as to whether the derivative instrument qualifies for designation as a hedge. These financial instruments are formally designated and documented as a hedge of a specific underlying exposure, as well as the risk management objectives and strategies for undertaking the hedge transaction. Because of the high degree of correlation between the hedging instrument and the underlying exposure being hedged, fluctuations in the value of the derivative instrument are generally offset by changes in the anticipated cash flows of the underlying exposure being hedged. Since the fair value of these derivatives fluctuates over their contractual lives, their fair value amounts should not be viewed in isolation, but rather in relation to the anticipated cash flows of the underlying hedged transaction and the overall reduction in Ferrellgas, L.P.’s risk relating to adverse fluctuations in propane prices. Ferrellgas, L.P. formally assesses, both at inception and at least quarterly thereafter, whether the financial instruments that are used in hedging transactions are effective at offsetting changes in the anticipated cash flows of the related underlying exposures. Any ineffective portion of a financial instrument’s change in fair value is recognized in “Cost of product sold - propane and other gas liquids sales” in the consolidated statements of operations. Financial instruments formally designated and documented as a hedge of a specific underlying exposure are recorded gross at fair value as either “Prepaid expenses and other current assets”, "Other assets, net", “Other current liabilities” or "Other liabilities" on the consolidated balance sheets with changes in fair value reported in other comprehensive income.

Interest Rate Risk.

Fluctuations in interest rates subject Ferrellgas, L.P. to interest rate risk. Decreases in interest rates increase the fair value of Ferrellgas, L.P.’s fixed rate debt, while increases in interest rates subject Ferrellgas, L.P. to the risk of increased interest expense related to its variable rate borrowings.

Ferrellgas, L.P. may enter into fair value hedges to help reduce its fixed interest rate risk. Interest rate swaps may be used to hedge the exposure to changes in the fair value of fixed rate debt due to changes in interest rates. Fixed rate debt that has been designated as being hedged is adjusted to offset the change in the fair value of interest rate derivatives that are fair value hedges, which are classified as “Prepaid expenses and other current assets”, “Other assets, net”, Other current liabilities” or as “Other liabilities” on the consolidated balance sheets. Changes in the fair value of fixed rate debt and any related fair value hedges are recognized as they occur in “Interest expense” on the consolidated statements of operations.

Ferrellgas, L.P. may enter into cash flow hedges to help reduce its variable interest rate risk. Interest rate swaps are used to hedge the risk associated with rising interest rates and their effect on forecasted interest payments related to variable rate borrowings. These interest rate swaps are designated as cash flow hedges. Thus, the effective portions of changes in the fair value of the hedges are recorded in “Prepaid expenses and other current assets”, “Other assets, net”, “Other current liabilities” or as “Other liabilities” with an offsetting entry to “Other comprehensive income” at interim periods and are subsequently recognized as interest expense in the consolidated statement of earnings when the forecasted transaction impacts earnings. Changes in the fair value of any cash flow hedges that are considered ineffective are recognized as interest expense on the consolidated statements of operations as they occur.

(10) Revenue recognition: Revenues from Ferrellgas, L.P.'s propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas, L.P. determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas, L.P. offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas, L.P. recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Prior to the dispositions in 2018 which constituted Ferrellgas, L.P.'s Midstream operations segment, revenues included crude oil sales, pipeline tariffs, trucking fees, rail throughput fees, pipeline management services, leasing, throughput, storage and salt water disposal. These revenues were recognized upon completion of the related service or delivery of product.

(11) Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas, L.P. owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas, L.P. are classified within “Equipment lease expense.”

See Note F – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

(12) Cost of sales: “Cost of sales – propane and other gas liquids sales” includes all costs to acquire propane and other gas liquids, the costs of storing and transporting inventory prior to delivery to Ferrellgas, L.P.’s customers, the results from risk management activities to hedge related price risk and the costs of materials related to the refurbishment of Ferrellgas, L.P.’s portable propane tanks. "Cost of sales - midstream operations" includes all costs incurred to purchase and transport crude oil, including the costs of terminaling and transporting crude oil prior to delivery to customers and the costs of salt water disposal. “Cost of sales – other” primarily includes costs related to the sale of propane appliances and equipment.

(13) Operating expenses: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

(15) Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

The ICPs are not Ferrellgas, L.P. stock-compensation plans; however, in accordance with Ferrellgas, L.P.’s partnership agreements, all Ferrellgas, L.P. employee-related costs incurred by Ferrell Companies are allocated to Ferrellgas, L.P. As a result, Ferrellgas, L.P. incurs a non-cash compensation charge from Ferrell Companies. During the years ended July 31, 2018, 2017 and 2016, the portion of the total non-cash compensation charge relating to the ICPs was $0.0 million, $3.3 million and $9.3 million, respectively.

(16) Income taxes: Ferrellgas, L.P. is a limited partnership and owns three subsidiaries that are taxable corporations. As a result, except for the taxable corporations, Ferrellgas, L.P.’s earnings or losses for federal income tax purposes are included in the tax returns of the individual partners. Accordingly, the accompanying consolidated financial statements of Ferrellgas, L.P. reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to partners as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas, L.P.’s partnership agreement and differences between Ferrellgas, L.P.’s financial reporting year end and limited partners tax year end.

Income tax benefit consisted of the following:



	For the year ended July 31,
	2018			2017			2016
Current expense (benefit)	$	1,119		$	(1,160	)	$	463
Deferred expense (benefit)	(3,818		)	11			(504		)
Income tax benefit	$	(2,699	)	$	(1,149	)	$	(41	)

Deferred taxes consisted of the following:



	July 31,
	2018			2017
Deferred tax assets (included in Other assets, net in 2018 and Prepaid expenses and other current assets in 2017)	$	715		$	1,068
Deferred tax liabilities (included in Other liabilities)	(16		)	(4,186		)
Net deferred tax asset (liability)	$	699		$	(3,118	)

(17) Sales taxes: Ferrellgas, L.P. accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

(18) Loss contingencies: In the normal course of business, Ferrellgas, L.P. is involved in various claims and legal proceedings. Ferrellgas, L.P. records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

(19) New accounting standards:

FASB Accounting Standard Update No. 2014-09

In May 2014, the Financial Accounting Standards Board, ("FASB") issued Accounting Standard Update ("ASU") 2014-09, Revenue from Contracts with Customers. The issuance is part of a joint effort by the FASB and the International Accounting Standards Board ("IASB") to enhance financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards ("IFRS") and, thereby, improving the consistency of requirements, comparability of practices and usefulness of disclosures. The new standard will supersede much of the existing authoritative literature for revenue recognition. The standard and related amendments will be effective for Ferrellgas, L.P. for its annual reporting period beginning August 1, 2018, including interim periods within that reporting period. Entities are allowed to transition to the new standard by either recasting prior periods or recognizing the cumulative effect. Ferrellgas, L.P. has completed its assessment of its contracts with customers and impacts to revenue recognition under the new guidance. When Ferrellgas, L.P. adopts the new guidance, which will be August 1, 2018, the impact will not be material to its consolidated financial statements. Ferrellgas, L.P. will utilize the modified retrospective transition method, which recognizes the cumulative effect upon adoption, when it adopts the new standard.

FASB Accounting Standard Update No. 2016-02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability

among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Ferrellgas, L.P. is currently evaluating the impact of its pending adoption of ASU 2016-02 on the consolidated financial statements. Ferrellgas, L.P. has formed an implementation team, completed training on the new standard, and is working on an initial assessment.

FASB Accounting Standard Update No. 2016-13

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), which requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Ferrellgas, L.P. is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

FASB Accounting Standard Update No. 2017-12

In August 2017, the FASB issued ASU 2017-12, Financial Instruments - Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities, which is intended to improve the financial reporting for hedging relationships to better portray the economic results of an entity's risk management activities in its financial statements. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Ferrellgas is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

Asset impairments	12 Months Ended
Asset impairments	Jul. 31, 2018
Asset Impairment Charges [Text Block]	Asset impairments First Quarter ended October 31, 2015 Goodwill impairment During the three months ended October 31, 2015, Ferrellgas determined that the continued and prolonged decline in the price of crude oil constituted a triggering event for its Midstream operations - water solutions reporting. As a result of the ensuing goodwill impairment test, Ferrellgas determined that goodwill was completely impaired and wrote off the entire $29.3 million of goodwill related to this reporting unit. Ferrellgas estimated the fair value of the reporting unit using a discounted cash flow model. Then, Ferrellgas estimated an implied fair value of goodwill by assigning the estimated fair value of the reporting unit to all the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination. Fourth Quarter ended July 31, 2016 During the year ended July 31, 2016, approximately 60% of Bridger's gross margin was generated from its largest customer and Jamex, that customer's supplier, under take-or-pay arrangements. Bridger's largest customer during the fiscal year ended July 31, 2016 owned a refinery in Trainer, Pennsylvania. As a result of numerous developments with Jamex and this customer during the second half of fiscal 2016, as of July 31, 2016, we did not anticipate any material contribution to revenue or gross margin from Jamex or Bridger's largest customer in the future. Additionally, the continued, sustained decline in crude oil prices and resulting decrease in crude oil production in the regions in which we operated significantly impacted our trucking operations during the three months ended July 31, 2016, a trend Ferrellgas anticipated would continue into fiscal 2017 and beyond. This expected decline in future cash flows from operations constituted a triggering event in the fourth fiscal quarter of 2016 for its Midstream operations - crude oil logistics reporting unit, requiring impairment testing of indefinite-lived intangible assets, long-lived tangible and intangible assets within certain asset groups, and goodwill. Tradename impairment Upon applying the fair-value-based test to its Midstream operations - crude oil logistics reporting unit indefinite-lived intangible asset, which consists of its tradename, Ferrellgas determined that the estimated fair value of the tradename as of July 31, 2016 was less than the carrying value, and as a result recorded an impairment charge of $7.4 million as of July 31, 2016. Ferrellgas estimated the fair value of the tradename using the relief from royalty method, which is an income approach. Critical assumptions included in the relief from royalty method include: (1) discounted future cash flows; (2) growth factors; (3) a discount rate; and (4) a long-term growth rate. The majority of these critical assumptions were unobservable, accordingly Ferrellgas' estimate of fair value of the tradename was considered to be Level 3 in the fair value hierarchy. Long-lived asset impairment Ferrellgas determined that multiple asset groups within the Midstream operations - crude oil logistics reporting unit were not recoverable. Ferrellgas estimated the fair value of each of these asset groups and recorded impairment charges to the extent that fair value was less than the carrying value of the asset group. As of July 31, 2016, impairment charges of $249.0 million related to customer relationships and non-compete agreements and $181.8 million related to property, plant and equipment are included in “Asset impairments” in the Consolidated Statement of Operations. Fair value of the asset groups was determined using an income approach, which was comprised of multiple significant unobservable inputs including: (1) estimate of future cash flows; (2) the timing, success rate and capital required for certain organic growth projects; (3) the amount of capital expenditures required to maintain the existing cash flows; and (4) a terminal period growth rate equal to the expected rate of inflation. Accordingly, Ferrellgas' estimates of fair value of these asset groups were considered to be Level 3 in the fair value hierarchy. Goodwill impairment Ferrellgas concluded that the fair value of the Midstream operations - crude oil logistics reporting unit no longer exceeded its carrying value as of July 31, 2016. Upon applying the second step of the impairment test, Ferrellgas determined that the implied fair value of goodwill was zero, and accordingly we recorded an impairment charge of $190.6 million as of July 31, 2016, or all of the goodwill previously allocated to this reporting unit. Ferrellgas used a discounted future cash flow model to estimate fair value of the reporting unit, which included multiple significant unobservable inputs, thus the estimate was considered to be Level 3 in the fair value hierarchy. Ferrellgas prepared various cash flow models involving certain potential scenarios and probability weighted these scenarios which included the following critical assumptions: (1) discounted future cash flows; (2) the timing, success rate and capital required for certain organic growth projects; (3) the amount of capital expenditures required to maintain the existing cash flows; and (4) a terminal period growth rate equal to the expected rate of inflation. In addition to these critical cash flow assumptions, a discount rate of 11.5% was applied to the various projected cash flow models. Judgments and assumptions are inherent in management’s estimates used to determine the fair value of Ferrellgas' reporting units and the fair value of its indefinite-lived assets and long-lived assets, and are consistent with what management believes would be utilized by primary market participants. Second Quarter ended January 31, 2018 During the quarter ended January 31, 2018, Ferrellgas recorded a goodwill impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment.
Ferrellgas, L.P. [Member]
Asset Impairment Charges [Text Block]	Asset impairments First Quarter ended October 31, 2015 Goodwill impairment During the three months ended October 31, 2015, Ferrellgas, L.P. determined that the continued and prolonged decline in the price of crude oil constituted a triggering event for its Midstream operations - water solutions reporting. As a result of the ensuing goodwill impairment test, Ferrellgas, L.P. determined that goodwill was completely impaired and wrote off the entire $29.3 million of goodwill related to this reporting unit. Ferrellgas, L.P. estimated the fair value of the reporting unit using a discounted cash flow model. Then, Ferrellgas, L.P. estimated an implied fair value of goodwill by assigning the estimated fair value of the reporting unit to all the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination. Fourth Quarter ended July 31, 2016 During the year ended July 31, 2016, approximately 60% of Bridger's gross margin was generated from its largest customer and Jamex, that customer's supplier, under take-or-pay arrangements. Bridger's largest customer during the fiscal year ended July 31, 2016 owned a refinery in Trainer, Pennsylvania. As a result of numerous developments with Jamex and this customer during the second half of fiscal 2016, as of July 31, 2016, we did not anticipate any material contribution to revenue or gross margin from Jamex or Bridger's largest customer in the future. Additionally, the continued, sustained decline in crude oil prices and resulting decrease in crude oil production in the regions in which we operated significantly impacted our trucking operations during the three months ended July 31, 2016, a trend Ferrellgas, L.P. anticipated would continue into fiscal 2017 and beyond. This expected decline in future cash flows from operations constituted a triggering event in the fourth fiscal quarter of 2016 for its Midstream operations - crude oil logistics reporting unit, requiring impairment testing of indefinite-lived intangible assets, long-lived tangible and intangible assets within certain asset groups, and goodwill. Tradename impairment Upon applying the fair-value-based test to its Midstream operations - crude oil logistics reporting unit indefinite-lived intangible asset, which consists of its tradename, Ferrellgas, L.P. determined that the estimated fair value of the tradename as of July 31, 2016 was less than the carrying value, and as a result recorded an impairment charge of $7.4 million as of July 31, 2016. Ferrellgas, L.P. estimated the fair value of the tradename using the relief from royalty method, which is an income approach. Critical assumptions included in the relief from royalty method include: (1) discounted future cash flows; (2) growth factors; (3) a discount rate; and (4) a long-term growth rate. The majority of these critical assumptions were unobservable, accordingly Ferrellgas, L.P.'s estimate of fair value of the tradename was considered to be Level 3 in the fair value hierarchy. Long-lived asset impairment Ferrellgas, L.P. determined that multiple asset groups within the Midstream operations - crude oil logistics reporting unit were not recoverable. Ferrellgas, L.P. estimated the fair value of each of these asset groups and recorded impairment charges to the extent that fair value was less than the carrying value of the asset group. As of July 31, 2016, impairment charges of $249.0 million related to customer relationships and non-compete agreements and $181.8 million related to property, plant and equipment are included in “Asset impairments” in the Consolidated Statement of Operations. Fair value of the asset groups was determined using an income approach, which was comprised of multiple significant unobservable inputs including: (1) estimate of future cash flows; (2) the timing, success rate and capital required for certain organic growth projects; (3) the amount of capital expenditures required to maintain the existing cash flows; and (4) a terminal period growth rate equal to the expected rate of inflation. Accordingly, Ferrellgas, L.P.'s estimates of fair value of these asset groups were considered to be Level 3 in the fair value hierarchy. Goodwill impairment Ferrellgas, L.P. concluded that the fair value of the Midstream operations - crude oil logistics reporting unit no longer exceeded its carrying value as of July 31, 2016. Upon applying the second step of the impairment test, Ferrellgas, L.P. determined that the implied fair value of goodwill was zero, and accordingly we recorded an impairment charge of $190.6 million as of July 31, 2016, or all of the goodwill previously allocated to this reporting unit. Ferrellgas, L.P. used a discounted future cash flow model to estimate fair value of the reporting unit, which included multiple significant unobservable inputs, thus the estimate was considered to be Level 3 in the fair value hierarchy. Ferrellgas, L.P. prepared various cash flow models involving certain potential scenarios and probability weighted these scenarios which included the following critical assumptions: (1) discounted future cash flows; (2) the timing, success rate and capital required for certain organic growth projects; (3) the amount of capital expenditures required to maintain the existing cash flows; and (4) a terminal period growth rate equal to the expected rate of inflation. In addition to these critical cash flow assumptions, a discount rate of 11.5% was applied to the various projected cash flow models. Judgments and assumptions are inherent in management’s estimates used to determine the fair value of Ferrellgas, L.P.'s reporting units and the fair value of its indefinite-lived assets and long-lived assets, and are consistent with what management believes would be utilized by primary market participants. Second Quarter ended January 31, 2018 Goodwill impairment During the quarter ended January 31, 2018, Ferrellgas recorded a goodwill impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment.

Acquisitions, dispositions and other signficant transactions

12 Months Ended

Jul. 31, 2018

Business Combinations

Business combinations are accounted for under the acquisition method of accounting and the assets acquired and liabilities assumed are recorded at their estimated fair market values as of the acquisition dates. The results of operations are included in the consolidated statements of operations from the date of acquisition. The pro forma effect of these transactions was not material to Ferrellgas' balance sheets or results of operations.

Propane operations and related equipment sales

During fiscal 2018, Ferrellgas acquired propane distribution assets with an aggregate value of $20.6 million in the following transactions:


•	Lindsey Propane LLC, based in Tennessee, acquired August 2017;


•	Sevier County Propane, based in Tennessee, acquired August 2017;


•	Service Plus Propane, Inc., based in Virginia, acquired September 2017;


•	Tapper Propane, Inc., based in Michigan, acquired November 2017; and


•	Diamond Propane LLC, based in New York, acquired June 2018.

During fiscal 2017, Ferrellgas acquired propane distribution assets of Valley Center Propane, based in California, with an aggregate value of $4.4 million.

During fiscal 2016, Ferrellgas acquired propane distribution assets with an aggregate value of $6.6 million in the following transactions:


•	Gasco Energy Supply, LLC, based in Missouri, acquired December 2015;


•	Warren Energy Supply, Inc. based in Utah, acquired February 2016; and


•	Selphs Propane, Inc., based in Colorado, acquired June 2016.

These acquisitions were funded as follows on their dates of acquisition:



	For the year ended July 31,
	2018		2017		2016
Cash payments, net of cash acquired	$	18,141	$	3,539	$	4,476
Issuance of liabilities and other costs and considerations	2,426		856		2,126
Aggregate fair value of transactions	$	20,567	$	4,395	$	6,602

The aggregate fair values, for the acquisitions in propane operations and related equipment sales reporting segment, were allocated as follows, including any adjustments identified during the measurement period:



	For the year ended July 31,
	2018		2017		2016
Working capital	$	758	$	139	$	(249	)
Customer tanks, buildings, land and other	10,022		1,220		3,625
Customer lists	7,758		2,648		2,962
Non-compete agreements	2,029		388		264
Aggregate fair value of net assets acquired	$	20,567	$	4,395	$	6,602

The estimated fair values and useful lives of assets acquired during fiscal 2018 are based on a preliminary valuation and are subject to final valuation adjustments. Ferrellgas intends to continue its analysis of the net assets of these transactions to determine the final allocation of the total purchase price to the various assets and liabilities acquired. The estimated fair values and useful lives of assets acquired during fiscal 2017 and 2016 are based on internal valuations and included only minor adjustments during the 12 month period after the date of acquisition. Due to the immateriality of these adjustments, Ferrellgas did not retrospectively adjust the consolidated statements of operations for those measurement period adjustments.

Midstream operations

During fiscal 2016, Ferrellgas acquired the crude oil logistics assets of South C&C Trucking, LLC, based in Texas, with an aggregate value of $10.7 million. The aggregate fair values for this acquisition were allocated as follows: $(0.6) million of working capital, $9.2 million of plant, property, and equipment, $0.7 million of intangibles, and $1.4 million of goodwill.

The following table summarizes the final estimated fair values of the assets acquired and liabilities assumed in connection with the Bridger acquisition completed in fiscal 2015:



	June 24, 2016
Working capital	$	(8,315	)
Transportation equipment	293,491
Injection stations and pipelines	41,632
Goodwill	189,196
Customer relationships	277,224
Non-compete agreements	10,000
Trade names & trademarks	9,400
Office equipment	7,449
Other	2,375
Aggregate fair value of net assets acquired	$	822,452

Dispositions

Propane operations and related equipment sales

During July 2018, Ferrellgas completed the sale of a group of assets encompassing an immaterial reporting unit within our Propane operations segment for approximately $26.6 million in cash. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $15.2 million related to this sale. The assets sold consist primarily of working capital and equipment.

Midstream operations

During July 2018, Ferrellgas completed the sale of a subsidiary and a group of assets within the Midstream operations segment for approximately $57.0 million in cash. The subsidiary sold was Bridger Environmental LLC, which encompasses all saltwater disposal activities previously operated by Ferrellgas. The group of assets sold includes all assets, excluding working capital, associated with the crude oil trucking operations previously operated by Ferrellgas. Additionally, the sale included two crude oil injection terminals. In separate transactions, the remaining assets of the Bridger Terminal business were sold to various parties. The largest of these assets, the Swan Ranch Terminal, was sold for $8.0 million in cash. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $120.2 million related to these sales.

Additionally, during fiscal 2018, Ferrellgas sold all 1,292 rail cars utilized in the Midstream operations segment for approximately $51.3 million in cash. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $36.8 million related to the sale of these rail cars. Proceeds from the transaction were used to reduce outstanding debt on Ferrellgas' previous secured credit facility. During fiscal 2018, Ferrellgas completed the sale of Bridger Energy, LLC, included in the Midstream operations segment, in exchange for an $8.5 million secured promissory note due in May 2020. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $4.0 million related to this sale.

The combined results from operations of these various Midstream dispositions in our Consolidated Statements of Operations includes losses before income taxes for the years ended July 31, 2018, 2017 and 2016 of $(55.4) million, $(62.2) million and $(685.1) million, respectively. The combined losses before income taxes attributable to Ferrellgas Partners, L.P. for the years ended July 31, 2018, 2017 and 2016 was $(54.8) million, $(61.6) million and $(678.2) million, respectively.

During fiscal 2016, Ferrellgas sold 134 trucks utilized in the Midstream operations segment.

"Loss on asset sales and disposals" consists of:



	For the year ended July 31,
	2018		2017		2016
Loss on sale of:
Propane-related accessories reporting unit	$	15,194	$	—	$	—
Midstream trucking, water disposal & terminal assets	120,240		—		—
Midstream railcars	36,762		—		—
Bridger Energy	4,002		—		—
Midstream trucks	—		—		13,810
Other	11,201		14,457		17,025
Loss on asset sales and disposals	$	187,399	$	14,457	$	30,835

Other significant transactions

Termination of Bridger agreement with Jamex Marketing, LLC

In connection with the closing of our acquisition of Bridger in June 2015, Bridger entered into a ten-year transportation and logistics agreement (the “Jamex TLA”) with Jamex Marketing, LLC ("Jamex") pursuant to which Jamex would be responsible for certain payments to Bridger and also for sourcing crude oil volumes for Bridger’s largest customer at that time.

On September 1, 2016, Bridger, Jamex, Ferrellgas Partners, L.P. and certain other affiliated parties entered into a group of agreements that terminated the Jamex TLA, facilitated Ferrellgas purchasing certain Ferrellgas common units from Jamex, and established payment terms for certain amounts owed by Jamex to Bridger under the Jamex TLA. Consequently, Ferrellgas did not anticipate any further material contributions to revenue or EBITDA from Jamex or Bridger's former largest customer.

On September 1, 2016, Bridger and Ferrellgas entered into a Termination, Settlement and Release Agreement (the “Jamex Termination Agreement”) with Jamex, certain of Jamex's affiliates, and James Ballengee (the owner of Jamex) pursuant to which:


(1)	Jamex agreed to execute and deliver a secured promissory note in favor of Bridger in original principal amount of $49.5 million (the "Jamex Secured Promissory Note") in satisfaction of all obligations owed to Bridger under the Jamex TLA;


(2)	Mr. Ballengee and Bacchus Capital Trading, LLC ("Bacchus"), an entity controlled by Mr. Ballengee, executed and delivered a joint guarantee of the Jamex Secured Promissory Note obligations up to a maximum aggregate amount of $20.0 million;


(3)	The operating partnership agreed to provide Jamex with a $5.0 million revolving secured working capital facility evidenced by a revolving promissory note (the “Jamex Revolving Promissory Note” and, together with the Jamex Secured Promissory Note, the “Jamex Notes”);


(4)	The other Jamex entities agreed to execute and deliver a security agreement and a full guarantee of the obligations under the Jamex Notes;


(5)	Ferrellgas paid approximately $16.9 million to Jamex and in return received 0.9 million of Ferrellgas Partners' common units, which were cancelled upon receipt, and approximately 23 thousand barrels of crude oil;


(6)	The parties agreed to terminate the Jamex TLA and certain other commercial agreements and arrangements between them, and release any claims between or among them that may exist (other than those arising under the Jamex Termination Agreement or the other agreements entered into in connection with the Jamex Termination Agreement); and


(7)	Ferrellgas waived the remaining lockup provision applicable to Jamex under the Registration Rights Agreement dated June 24, 2015 to which Jamex is party.

On June 25, 2018, Ferrellgas and Mr. Ballengee entered into an Omnibus Agreement (the "Omnibus Agreement") that, among other things, terminated and cancelled the Jamex Secured Promissory Note, the joint guarantee, and the Jamex Revolving Promissory Note. In connection with the termination and cancellation of such agreements, (1) Mr. Ballengee and Jamex paid Ferrellgas $16.3 million towards the remaining balance due under the Jamex Secured Promissory Note and Mr. Ballengee executed a new promissory note in favor of the operating partnership with an original principal amount of $18.3 million (the "Revised Jamex Promissory Note"), (2) Bacchus executed a guaranty agreement to guarantee Mr. Ballengee’s obligations under the Revised Jamex Promissory Note, (3) Ferrellgas agreed to dismiss without prejudice certain indemnification claims against Jamex and any affiliates of Jamex related to the Eddystone litigation and to toll the statute of limitations with respect thereto, and to dismiss with prejudice the tortious interference claim asserted by Ferrellgas against Mr. Ballengee related to the Eddystone litigation, and (4) Mr. Ballengee agreed to dismiss with prejudice, or cause to be dismissed, all counterclaims by him or his affiliates, as the case may be, with respect to such actions.

Supplemental Financial Statement Information

Business Combinations

Acquisitions

Propane operations and related equipment sales

During fiscal 2018, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $20.6 million in the following transactions:


•	Lindsey Propane LLC, based in Tennessee, acquired August 2017;


•	Sevier County Propane, based in Tennessee, acquired August 2017;


•	Service Plus Propane, Inc., based in Virginia, acquired September 2017;


•	Tapper Propane, Inc., based in Michigan, acquired November 2017; and


•	Diamond Propane LLC, based in New York, acquired June 2018.

During fiscal 2017, Ferrellgas, L.P. acquired propane distribution assets of Valley Center Propane, based in California, with an aggregate value of $4.4 million.

During fiscal 2016, Ferrellgas, L.P. acquired propane distribution assets with an aggregate value of $6.6 million in the following transactions:


•	Gasco Energy Supply, LLC, based in Missouri, acquired December 2015;


•	Warren Energy Supply, Inc. based in Utah, acquired February 2016; and


•	Selphs Propane, Inc., based in Colorado, acquired June 2016.

These acquisitions were funded as follows on their dates of acquisition:



	For the year ended July 31,
	2018		2017		2016
Cash payments, net of cash acquired	$	18,141	$	3,539	$	4,476
Issuance of liabilities and other costs and considerations	2,426		856		2,126
Aggregate fair value of transactions	$	20,567	$	4,395	$	6,602



	For the year ended July 31,
	2018		2017		2016
Working capital	758		139		(249		)
Customer tanks, buildings, land and other	10,022		1,220		3,625
Customer lists	7,758		2,648		2,962
Non-compete agreements	2,029		388		264
Aggregate fair value of net assets acquired	$	20,567	$	4,395	$	6,602

The estimated fair values and useful lives of assets acquired during fiscal 2018 are based on a preliminary valuation and are subject to final valuation adjustments. Ferrellgas, L.P. intends to continue its analysis of the net assets of these transactions to determine the final allocation of the total purchase price to the various assets and liabilities acquired. The estimated fair values and useful lives of assets acquired during fiscal 2017 and 2016 are based on internal valuations and included only minor adjustments during the 12 month period after the date of acquisition. Due to the immateriality of these adjustments, Ferrellgas, L.P. did not retrospectively adjust the consolidated statements of operations for those measurement period adjustments.

Midstream operations

During fiscal 2016, Ferrellgas, L.P. acquired the crude oil logistics assets of South C&C Trucking, LLC, based in Texas, with an aggregate value of $10.7 million. The aggregate fair values for this acquisition were allocated as follows: $(0.6) million of working capital, $9.2 million of plant, property, and equipment, $0.7 million of intangibles, and $1.4 million of goodwill.

The following table summarizes the final estimated fair values of the assets acquired and liabilities assumed in connection with the Bridger acquisition completed in fiscal 2015:



	June 24, 2016
Working capital	$	(8,315	)
Transportation equipment	293,491
Injection stations and pipelines	41,632
Goodwill	189,196
Customer relationships	277,224
Non-compete agreements	10,000
Trade names & trademarks	9,400
Office equipment	7,449
Other	2,375
Aggregate fair value of net assets acquired	$	822,452

Dispositions

Propane operations and related equipment sales

During July 2018, Ferrellgas, L.P. completed the sale of a group of assets encompassing an immaterial reporting unit within our Propane operations segment for approximately $26.6 million in cash. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $15.2 million related to this sale. The assets sold consist primarily of working capital and equipment.

Midstream operations

During July 2018, Ferrellgas, L.P. completed the sale of a subsidiary and a group of assets within the Midstream operations segment for approximately $57.0 million in cash. The subsidiary sold was Bridger Environmental LLC, which encompasses all saltwater disposal activities previously operated by Ferrellgas Partners. The group of assets sold includes all assets, excluding working capital, associated with the crude oil trucking operations previously operated by Ferrellgas Partners. Additionally, the sale included two crude oil injection terminals. In separate transactions, the remaining assets of the Bridger Terminal business were sold to various parties. The largest of these assets, the Swan Ranch Terminal, was sold for $8.0 million in cash. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $120.2 million related to these sales.

Additionally, during fiscal 2018, Ferrellgas, L.P. sold all 1,292 rail cars utilized in the Midstream operations segment for approximately $51.3 million in cash. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $36.8 million related to the sale of these rail cars. Proceeds from the transaction were used to reduce outstanding debt on Ferrellgas L.P.'s previous secured credit facility. During fiscal 2018, Ferrellgas, L.P. completed the sale of Bridger Energy, LLC, included in the Midstream operations segment, in exchange for an $8.5 million secured promissory note due in May 2020. For the year ended July 31, 2018, "Loss on asset sales and disposals" includes a loss of $4.0 million related to this sale.

The combined results from operations of these various Midstream dispositions in our Consolidated Statements of Operations includes losses before income taxes for the years ended July 31, 2018, 2017 and 2016 of $(55.4) million, $(62.2) million and $(685.1) million, respectively. The combined losses before income taxes attributable to Ferrellgas for the years ended July 31, 2018, 2017 and 2016 was $(54.8) million, $(61.6) million and $(678.2) million, respectively.

During fiscal 2016, Ferrellgas, L.P. sold 134 trucks utilized in the Midstream operations segment.

"Loss on asset sales and disposals" consists of:



	For the year ended July 31,
	2018		2017		2016
Loss on sale of:
Propane-related accessories reporting unit	$	15,194	$	—	$	—
Midstream trucking, water disposal & terminal assets	120,240		—		—
Midstream railcars	36,762		—		—
Bridger Energy	4,002		—		—
Midstream trucks	—		—		13,810
Other	11,201		14,457		17,025
Loss on asset sales and disposals	$	187,399	$	14,457	$	30,835

Other significant transactions

Termination of Bridger agreement with Jamex Marketing, LLC

On September 1, 2016, Bridger, Jamex, Ferrellgas Partners and certain other affiliated parties entered into a group of agreements that terminated the Jamex TLA, facilitated Ferrellgas Partners purchasing certain Ferrellgas Partners common units from Jamex, and established payment terms for certain amounts owed by Jamex to Bridger under the Jamex TLA. Consequently, Ferrellgas Partners did not anticipate any further material contribution to revenue or EBITDA from Jamex or Bridger's former largest customer.

On September 1, 2016, Bridger and Ferrellgas Partners entered into a Termination, Settlement and Release Agreement (the “Jamex Termination Agreement”) with Jamex, certain of Jamex's affiliates, and James Ballengee (the owner of Jamex) pursuant to which:


(1)	Jamex agreed to execute and deliver a secured promissory note in favor of Bridger in original principal amount of $49.5 million (the "Jamex Secured Promissory Note") in satisfaction of all obligations owed to Bridger under the Jamex TLA;


(2)	Mr. Ballengee and Bacchus Capital Trading, LLC, ("Bacchus"), an entity controlled by Mr. Ballengee, executed and delivered a joint guarantee of the Jamex Secured Promissory Note obligations up to a maximum aggregate amount of $20.0 million;


(3)	The operating partnership agreed to provide Jamex with a $5.0 million revolving secured working capital facility evidenced by a revolving promissory note (the “Jamex Revolving Promissory Note” and, together with the Jamex Secured Promissory Note, the “Jamex Notes”);


(4)	The other Jamex entities agreed to execute and deliver a security agreement and a full guarantee of the obligations under the Jamex Notes;


(5)	Ferrellgas Partners paid approximately $16.9 million to Jamex and in return received 0.9 million of Ferrellgas Partners' common units, which were cancelled upon receipt, and approximately 23 thousand barrels of crude oil;


(6)	The parties agreed to terminate the Jamex TLA and certain other commercial agreements and arrangements between them, and release any claims between or among them that may exist (other than those arising under the Jamex Termination Agreement or the other agreements entered into in connection with the Jamex Termination Agreement); and


(7)	Ferrellgas Partners waived the remaining lockup provision applicable to Jamex under the Registration Rights Agreement dated June 24, 2015 to which Jamex is party.

On June 25, 2018, Ferrellgas Partners and Mr. Ballengee entered into an Omnibus Agreement (the "Omnibus Agreement") that, among other things, terminated and cancelled the Jamex Secured Promissory Note, the joint guarantee, and the Jamex Revolving Promissory Note. In connection with the termination and cancellation of such agreements, (1) Mr. Ballengee and Jamex paid Ferrellgas, L.P. $16.3 million towards the remaining balance due under the Jamex Secured Promissory Note and Mr. Ballengee executed a new promissory note in favor of the operating partnership with an original principal amount of $18.3 million (the "Revised Jamex Promissory Note"), (2) Bacchus executed a guaranty agreement to guarantee Mr. Ballengee’s obligations under the Revised Jamex Promissory Note, (3) Ferrellgas Partners agreed to dismiss without prejudice certain indemnification claims against Jamex and any affiliates of Jamex related to the Eddystone litigation and to toll the statute of limitations with respect thereto, and to dismiss with prejudice the tortious interference claim asserted by Ferrellgas Partners against Mr. Ballengee related to the Eddystone litigation, and (4) Mr. Ballengee agreed to dismiss with prejudice, or cause to be dismissed, all counterclaims by him or his affiliates, as the case may be, with respect to such actions.

Quarterly Distributions Of Available Cash	12 Months Ended
Quarterly Distributions Of Available Cash	Jul. 31, 2018
Quarterly Distributions Of Available Cash	To the extent it is not precluded from doing so by a debt covenant or other restriction, Ferrellgas Partners makes quarterly cash distributions of all of its "available cash.” Available cash is defined in the partnership agreement of Ferrellgas Partners as, generally, the sum of its consolidated cash receipts less consolidated cash disbursements and net changes in reserves established by the general partner for future requirements. Reserves are retained in order to provide for the proper conduct of Ferrellgas Partners’ business, or to provide funds for distributions with respect to any one or more of the next four fiscal quarters. Distributions are made within 45 days after the end of each fiscal quarter ending October, January, April and July to holders of record on the applicable record date. Distributions by Ferrellgas Partners in an amount equal to 100% of its available cash, as defined in its partnership agreement, will be made to the common unitholders and the general partner. Additionally, the payment of incentive distributions to the holders of incentive distribution rights will be made to the extent that certain target levels of cash distributions are achieved.
Ferrellgas, L.P. [Member]
Quarterly Distributions Of Available Cash	To the extent it is not precluded from doing so by a debt covenant or other restriction, Ferrellgas, L.P. makes quarterly cash distributions of all of its "available cash." Available cash is defined in the partnership agreement of Ferrellgas, L.P. as, generally, the sum of its consolidated cash receipts less consolidated cash disbursements and net changes in reserves established by the general partner for future requirements. Reserves are retained in order to provide for the proper conduct of Ferrellgas, L.P.’s business, or to provide funds for distributions with respect to any one or more of the next four fiscal quarters. Distributions are made within 45 days after the end of each fiscal quarter ending October, January, April, and July. Distributions by Ferrellgas, L.P. in an amount equal to 100% of its available cash, as defined in its partnership agreement, will be made approximately 99% to Ferrellgas Partners and approximately 1% to the general partner. See Note I – Debt for additional disclosures related to Ferrellgas, L.P.'s ability to make quarterly cash distributions.

Supplemental Financial Statement Information

12 Months Ended

Jul. 31, 2018

Inventories consist of the following:



	2018		2017
Propane gas and related products	$	71,180	$	67,049
Appliances, parts and supplies, and other	12,514		25,503
Inventories	$	83,694	$	92,552

In addition to inventories on hand, Ferrellgas enters into contracts to take delivery of propane for supply procurement purposes with terms that generally do not exceed 36 months. Most of these contracts call for payment based on market prices at the date of delivery. As of July 31, 2018, Ferrellgas had committed, for supply procurement purposes, to take delivery of approximately 44.1 million gallons of propane at fixed prices.

Property, plant and equipment, net consist of the following:



	Estimated useful lives	2018		2017
Land	Indefinite	$	33,719	$	35,824
Land improvements	2-20	13,361		14,342
Buildings and improvements	20	71,612		73,333
Vehicles, including transport trailers	8-20	85,893		121,233
Bulk equipment and district facilities	5-30	103,627		104,291
Tanks, cylinders and customer equipment	2-30	769,165		755,867
Salt water disposal wells and related equipment	2-30	—		52,495
Rail cars	30	—		91,787
Injection stations	20	—		13,130
Pipeline	15	—		1,663
Computer and office equipment	2-5	109,346		118,518
Construction in progress	n/a	14,394		10,974
		1,201,117		1,393,457
Less: accumulated depreciation		643,394		661,534
Property, plant and equipment, net		$	557,723	$	731,923

Depreciation expense totaled $67.1 million, $68.1 million and $85.8 million for fiscal 2018, 2017 and 2016, respectively.

The decline in property, plant and equipment, net from fiscal 2017 to 2018 is primarily due to the dispositions that were completed during fiscal 2018. See Note D – Acquisitions, dispositions and other significant transactions for more information on the dispositions.

Other assets, net consist of the following:



	2018		2017
Notes receivable, less current portion	$	27,491	$	32,500
Other	47,097		41,557
Other assets, net	$	74,588	$	74,057

Other current liabilities consist of the following:



	2018		2017
Accrued interest	$	22,222	$	18,671
Customer deposits and advances	22,829		25,541
Accrued payroll	16,060		19,704
Accrued insurance	15,100		13,615
Other	65,814		48,693
Other current liabilities	$	142,025	$	126,224

Shipping and handling expenses are classified in the following consolidated statements of operations line items:



	For the year ended July 31,
	2018		2017		2016
Operating expense	$	195,646	$	175,164	$	167,980
Depreciation and amortization expense	4,947		3,909		4,282
Equipment lease expense	25,765		26,299		25,967
	$	226,358	$	205,372	$	198,229

For purposes of the consolidated statements of cash flows, Ferrellgas considers cash equivalents to include all highly liquid debt instruments purchased with an original maturity of three months or less. Certain cash flow and significant non-cash activities are presented below:



	For the year ended July 31,
	2018			2017		2016
CASH PAID (REFUNDED) FOR:
Interest	$	159,271		$	143,441	$	133,629
Income taxes	$	(291	)	$	310	$	777
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Liabilities incurred in connection with acquisitions	$	1,993		$	139	$	2,126
Change in accruals for property, plant and equipment additions	$	264		$	164	$	(1,122	)

Supplemental Financial Statement Information

Inventories consist of the following:



	2018		2017
Propane gas and related products	$	71,180	$	67,049
Appliances, parts and supplies, and other	12,514		25,503
Inventories	$	83,694	$	92,552

In addition to inventories on hand, Ferrellgas, L.P. enters into contracts to take delivery of propane for supply procurement purposes with terms that generally do not exceed 36 months. Most of these contracts call for payment based on market prices at the date of delivery. As of July 31, 2018, Ferrellgas, L.P. had committed, for supply procurement purposes, to take delivery of approximately 44.1 million gallons of propane at fixed prices.

Property, plant and equipment, net consist of the following:



	Estimated useful lives	2018		2017
Land	Indefinite	$	33,719	$	35,824
Land improvements	2-20	13,361		14,342
Buildings and improvements	20	71,612		73,333
Vehicles, including transport trailers	8-20	85,893		121,233
Bulk equipment and district facilities	5-30	103,627		104,291
Tanks, cylinders and customer equipment	2-30	769,165		755,867
Salt water disposal wells and related equipment	2-30	—		52,495
Rail cars	30	—		91,787
Injection stations	20	—		13,130
Pipeline	15	—		1,663
Computer and office equipment	2-5	109,346		118,518
Construction in progress	n/a	14,394		10,974
		1,201,117		1,393,457
Less: accumulated depreciation		643,394		661,534
Property, plant and equipment, net		$	557,723	$	731,923

Depreciation expense totaled $67.1 million, $68.1 million and $85.8 million for fiscal 2018, 2017 and 2016, respectively.

Other assets, net consist of the following:



	2018		2017
Notes receivable, less current portion	$	27,491	$	32,500
Other	47,097		41,557
Other assets, net	$	74,588	$	74,057

Other current liabilities consist of the following:



	2018		2017
Customer deposits and advances	$	22,829	$	25,541
Accrued interest	18,288		14,737
Accrued payroll	16,060		19,704
Accrued insurance	15,100		13,615
Other	65,814		48,419
Other current liabilities	$	138,091	$	122,016

Shipping and handling expenses are classified in the following consolidated statements of operations line items:



	For the year ended July 31,
	2018		2017		2016
Operating expense	$	195,646	$	175,164	$	167,980
Depreciation and amortization expense	4,947		3,909		4,282
Equipment lease expense	25,765		26,299		25,967
	$	226,358	$	205,372	$	198,229

For purposes of the consolidated statements of cash flows, Ferrellgas, L.P. considers cash equivalents to include all highly liquid debt instruments purchased with an original maturity of three months or less. Certain cash flow and significant non-cash activities are presented below:



	For the year ended July 31,
	2018			2017		2016
CASH PAID (REFUNDED) FOR:
Interest	$	128,479		$	122,084	$	117,931
Income taxes	$	(311	)	$	305	$	773
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Liabilities incurred in connection with acquisitions	$	1,993		$	139	$	2,126
Change in accruals for property, plant and equipment additions	$	264		$	164	$	(1,122	)

Accounts And Notes Receivable, Net And Accounts Receivable Securitization

12 Months Ended

Jul. 31, 2018

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

Accounts and notes receivable, net consist of the following:



	2018			2017
Accounts receivable pledged as collateral	$	120,079		$	109,407
Accounts receivable	8,272			47,346
Note receivable, current portion	132			10,000
Other	26			307
Less: Allowance for doubtful accounts	(2,455		)	(1,976		)
Accounts and notes receivable, net	$	126,054		$	165,084

On May 14, 2018, Ferrellgas entered into a seventh amendment to its accounts receivable securitization facility with Wells Fargo Bank, N.A., Fifth Third Bank and PNC Bank, N.A. The amendment extends the maturity date to May 2021 and increases the size of the facility from a maximum borrowing capacity of $225.0 million to $250.0 million at a discount rate of LIBOR plus 200 basis points. The amended accounts receivable securitization facility also includes provisions for the issuance of letters of credit with a $50.0 million sublimit. The facility continues to contain provisions where maximum purchase levels are reduced during periods of the year when working capital requirements are lower to efficiently reduce unused capacity fees. Prior to the amendment entered into in May 2018, Ferrellgas entered into two amendments in fiscal 2017 that modified covenant requirements.

At July 31, 2018, $120.1 million of trade accounts receivable were pledged as collateral against $58.0 million of collateralized notes payable due to the commercial paper conduit. At July 31, 2017, $109.4 million of trade accounts receivable were pledged as collateral against $69.0 million of collateralized notes payable due to the commercial paper conduit. These accounts receivable pledged as collateral are bankruptcy remote from the operating partnership. The operating partnership does not provide any guarantee or similar support to the collectability of these accounts receivable pledged as collateral.

As of July 31, 2018, Ferrellgas had received cash proceeds of $58.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. As of July 31, 2017, Ferrellgas had received cash proceeds of $69.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. Borrowings under the accounts receivable securitization facility had a weighted average interest rate of 5.2% and 4.0% as of July 31, 2018 and 2017, respectively.

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

Accounts and notes receivable, net consist of the following:



	2018			2017
Accounts receivable pledged as collateral	$	120,079		$	109,407
Accounts receivable	8,272			47,346
Note receivable, current portion	132			10,000
Other	26			307
Less: Allowance for doubtful accounts	(2,455		)	(1,976		)
Accounts and notes receivable, net	$	126,054		$	165,084

On May 14, 2018, Ferrellgas, L.P. entered into a seventh amendment to its accounts receivable securitization facility with Wells Fargo Bank, N.A., Fifth Third Bank and PNC Bank, N.A. The amendment extends the maturity date to May 2021 and increases the size of the facility from a maximum borrowing capacity of $225.0 million to $250.0 million at a discount rate of LIBOR plus 200 basis points. The amended accounts receivable securitization facility also includes provisions for the issuance of letters of credit with a $50.0 million sublimit. The facility continues to contain provisions where maximum purchase levels are reduced during periods of the year when working capital requirements are lower to efficiently reduce unused capacity fees.

Prior to the amendment entered into in May 2018, Ferrellgas, L.P. entered into two amendments in fiscal 2017 that modified covenant requirements.

At July 31, 2018, $120.1 million of trade accounts receivable were pledged as collateral against $58.0 million of collateralized notes payable due to the commercial paper conduit. At July 31, 2017, $109.4 million of trade accounts receivable were pledged as collateral against $69.0 million of collateralized notes payable due to the commercial paper conduit. These accounts receivable pledged as collateral are bankruptcy remote from Ferrellgas, L.P. Ferrellgas, L.P. does not provide any guarantee or similar support to the collectability of these accounts receivable pledged as collateral.

As of July 31, 2018, Ferrellgas, L.P. had received cash proceeds of $58.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. As of July 31, 2017, Ferrellgas, L.P. had received cash proceeds of $69.0 million from trade accounts receivables securitized, with no remaining capacity to receive additional proceeds. Borrowings under the accounts receivable securitization facility had a weighted average interest rate of 5.2% and 4.0% as of July 31, 2018 and 2017, respectively.

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

Goodwill And Intangible Assets, Net

12 Months Ended

Jul. 31, 2018

Goodwill and intangible assets, net consist of the following:



	July 31, 2018							July 31, 2017
	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Goodwill, net	$	246,098	$	—		$	246,098	$	256,103	$	—		$	256,103

Intangible assets, net
Amortized intangible assets
Customer related	$	441,393	$	(376,605	)	$	64,788	$	556,678	$	(397,891	)	$	158,787
Non-compete agreements	24,653		(19,511		)	5,142		39,875		(27,887		)	11,988
Permits and favorable lease arrangements	—		—			—		17,225		(3,506		)	13,719
Other	3,513		(3,513		)	—		9,301		(7,144		)	2,157
	469,559		(399,629		)	69,930		623,079		(436,428		)	186,651

Unamortized intangible assets
Trade names & trademarks	51,021		—			51,021		64,451		—			64,451
Total intangible assets, net	$	520,580	$	(399,629	)	$	120,951	$	687,530	$	(436,428	)	$	251,102

See Note C – Asset impairments for disclosures regarding impairments recorded during fiscal 2018.

Intangible assets, net declined during fiscal 2018 as result of the dispositions that were completed during the year, see Note D – Acquisitions, dispositions and other significant transactions for more information relating to the completed dispositions.

Changes in the carrying amount of goodwill are as follows:



	Propane operations and related equipment sales
Balance July 31, 2016	$	256,103
Acquisitions	—
Balance July 31, 2017	256,103
Impairment	(10,005		)
Balance July 31, 2018	$	246,098

Customer related intangible assets have estimated lives of 15 years and non-compete agreements and other intangible assets have estimated lives ranging from five to 10 years. Ferrellgas intends to utilize all acquired trademarks and trade names and does not believe there are any legal, regulatory, contractual, competitive, economical or other factors that would limit their useful lives. Therefore, trademarks and trade names have indefinite useful lives. Customer related intangibles, non-compete agreements and other intangibles carry a weighted average life of 15 and nine years, respectively.



Aggregate amortization expense related to intangible assets, net:
For the year ended July 31,
2018	$	31,345
2017	32,148
2016	61,970



Estimated amortization expense:
For the year ended July 31,
2019	$	14,388
2020	8,877
2021	8,182
2022	6,810
2023	6,492

oodwill and intangible assets, net consist of the following:



	July 31, 2018							July 31, 2017
	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Goodwill, net	$	246,098	$	—		$	246,098	$	256,103	$	—		$	256,103

Intangible assets, net
Amortized intangible assets
Customer related	$	441,393	$	(376,605	)	$	64,788	$	556,678	$	(397,891	)	$	158,787
Non-compete agreements	24,653		(19,511		)	5,142		39,875		(27,887		)	11,988
Permits and favorable lease arrangements	—		—			—		17,225		(3,506		)	13,719
Other	3,513		(3,513		)	—		9,301		(7,144		)	2,157
	469,559		(399,629		)	69,930		623,079		(436,428		)	186,651

Unamortized intangible assets
Trade names & trademarks	51,021		—			51,021		64,451		—			64,451
Total intangible assets, net	$	520,580	$	(399,629	)	$	120,951	$	687,530	$	(436,428	)	$	251,102

See Note C – Asset impairments for disclosures regarding impairments recorded during fiscal 2018.

Changes in the carrying amount of goodwill are as follows:



	Propane operations and related equipment sales
Balance July 31, 2016	$	256,103
Acquisitions	—
Balance July 31, 2017	256,103
Impairment	(10,005		)
Balance July 31, 2018	$	246,098

Customer related intangible assets have estimated lives of 15 years and non-compete agreements and other intangible assets have estimated lives ranging from five to 10 years. Ferrellgas, L.P. intends to utilize all acquired trademarks and trade names and does not believe there are any legal, regulatory, contractual, competitive, economical or other factors that would limit their useful lives. Therefore, trademarks and trade names have indefinite useful lives. Customer related intangibles, non-compete agreements and other intangibles carry a weighted average life of 15 and nine years, respectively.



Aggregate amortization expense related to intangible assets, net:
For the year ended July 31,
2018	$	31,345
2017	32,148
2016	61,970



Estimated amortization expense:
For the year ended July 31,
2019	$	14,388
2020	8,877
2021	8,182
2022	6,810
2023	6,492

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

Debt Disclosure [Text Block]

Debt

12 Months Ended

Jul. 31, 2018

Short-term borrowings

Ferrellgas classifies a portion of the secured credit facilities borrowings as short-term because they were used to fund working capital needs that management intends to pay down within the 12 month period following each balance sheet date. As of July 31, 2018 and 2017, $32.8 million and $59.8 million, respectively, were classified as short-term borrowings. For further discussion see the secured credit facilities section below.

Long-term debt

Long-term debt consists of the following:



	2018			2017
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000		$	500,000
Fixed rate, 6.75%, due 2023 (4)	500,000			500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $2,375 and $3,166 at 2018 and 2017, respectively (3)	477,375			478,166
Fixed rate, 8.625%, due 2020, net of unamortized discount of $3,766 and $5,976 at 2018 and 2017, respectively (2)	353,234			351,024
Fair value adjustments related to interest rate swaps	—			471

Secured credit facilities
Variable interest rate, Term Loan, matures May 2023	275,000			—
Variable interest rate, Revolving Facility (net of $59.8 million classified as short-term borrowings at July 31, 2017)	—			185,719

Notes payable
11.2% and 12.0% weighted average interest rate at July 31, 2018 and 2017, respectively, due 2019 to 2025, net of unamortized discount of $977 and $1,128 at July 31, 2018 and 2017, respectively	6,221			5,958
Total debt, excluding unamortized debt issuance and other costs	2,111,830			2,021,338
Unamortized debt issuance and other costs	(30,791		)	(22,965		)
Less: current portion, included in other current liabilities on the consolidated balance sheets	2,402			2,578
Long-term debt	$	2,078,637		$	1,995,795

(1)

During November 2010, Ferrellgas issued $500.0 million in aggregate principal amount of 6.50% senior notes due 2021. These notes are general unsecured senior obligations of Ferrellgas and are effectively junior to all future senior secured indebtedness of Ferrellgas, to the extent of the value of the assets securing the debt, and are structurally subordinated to all existing and future indebtedness and obligations of the operating partnership. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on May 1 and November 1 of each year. The outstanding principal amount is due on May 1, 2021. Ferrellgas would incur prepayment penalties if it were to repay the notes prior to May 2019.

(2)

During January 2017, Ferrellgas issued, $175.0 million in aggregate principal amount of additional 8.625% unsecured senior notes due 2020, issued at 96% of par. Ferrellgas contributed the net proceeds from the offering of approximately $166.1 million to the operating partnership, which used such amounts to repay borrowings under its secured credit facility. During April 2010, Ferrellgas issued $280.0 million of its fixed rate senior notes. During March 2011, Ferrellgas redeemed $98.0 million of these fixed rate senior notes. The unsecured senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year.


(3)	During fiscal 2014, Ferrellgas issued $475.0 million in aggregate principal amount of 6.75% senior notes due 2022. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on January 15 and July 15 of each year. Ferrellgas would incur prepayment penalties if it were to repay the notes prior to November 2019.


(4)	During June 2015, Ferrellgas issued $500.0 million in aggregate principal amount of 6.75% senior notes due 2023. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year. Ferrellgas would incur prepayment penalties if it were to repay the notes prior to June 2021.

The scheduled annual principal payments on long-term debt are as follows:



For the year ending July 31,	Scheduled annual principal payments
2019	$	2,402
2020	358,671
2021	501,456
2022	475,796
2023	775,426
Thereafter	447
Total	$	2,114,198

Secured credit facilities

On May 4, 2018, the operating partnership entered into a new $575.0 million senior secured credit facility (the "Senior Secured Credit Facility") to replace its previous $575.0 million senior secured credit facility that was scheduled to mature in October 2018 (the "Previous Facility"). The Senior Secured Credit Facility consists of a $300.0 million revolving line of credit (the "Revolving Facility") as well as a $275.0 million term loan (the "Term Loan"), which mature on May 4, 2023. Revolving Facility borrowings bear interest at the Prime Rate + 4.75% and Term Loan borrowings bear interest at LIBOR + 5.75%. The Revolving Facility includes a $125.0 million sublimit for the issuance of letters of credit. Borrowings under the Senior Secured Credit Facility are available for working capital needs, capital expenditures and other general partnership purposes, including the refinancing of existing indebtedness and acquisitions, within certain limits.

The Term Loan does not include any scheduled principal payments and the Revolving Facility does not have any scheduled commitment reductions before maturity; however, the Term Loan requires prepayments pursuant to the following: 1) certain asset sales, 2) 50% of any excess cash flow, as defined by the Term Loan, in any fiscal year beginning with fiscal year 2019, 3) certain insurance proceeds, and 4) certain tax refunds.

The Senior Secured Credit Facility is secured with substantially all of the assets of the operating partnership and its subsidiaries, and Ferrellgas Partners’ and the general partner’s partnership interests in the operating partnership, and contains various affirmative and negative covenants and default provisions, as well as requirements with respect to the maintenance of specified financial ratios and limitations on the making of loans and investments.

As of July 31, 2018, the operating partnership had borrowings of $275.0 million under the Term Loan at a rate of 7.86%, which was classified as long-term debt and $32.8 million under the Revolving Facility at a rate of 9.75%, which was classified as short-term borrowings. As of July 31, 2018, Ferrellgas had available borrowing capacity under its Revolving Facility of $159.3 million. As of July 31, 2017, Ferrellgas had total borrowings outstanding under its Previous Facility of $245.5 million, of which $185.7 million was classified as long-term debt. Borrowings outstanding at July 31, 2017 under the Previous Facility had a weighted average interest rate of 6.0%. As of July 31, 2017, Ferrellgas had available borrowing capacity under its Previous Facility of $190.3 million; however additional borrowings were limited to $67.5 million by a covenant under the Previous Facility.

Letters of credit outstanding at July 31, 2018 and 2017 totaled $107.9 million and $139.2 million, respectively, and were used to secure insurance arrangements, product purchases and commodity hedges. At July 31, 2018, Ferrellgas had available letter of credit remaining capacity of $17.1 million. At July 31, 2017, Ferrellgas had available letter of credit remaining capacity of $60.8 million. Ferrellgas incurred commitment fees of $0.7 million, $1.1 million and $1.4 million in fiscal 2018, 2017 and 2016, respectively.

Financial covenants

The indenture governing the outstanding notes of Ferrellgas Partners and the agreements governing the operating partnership’s indebtedness contain various covenants that limit Ferrellgas Partners' ability and the ability of specified subsidiaries to, among other things, make restricted payments and incur additional indebtedness. The general partner believes that the most restrictive of these covenants is the consolidated fixed charge coverage ratio, as defined in the indenture governing the outstanding notes of Ferrellgas Partners, and the consolidated fixed charge coverage ratio, as defined in the indentures governing the outstanding notes of the operating partnership.

Consolidated fixed charge coverage ratio - Ferrellgas Partners, L.P., the master limited partnership

Before a restricted payment (as defined in the Ferrellgas Partners indenture) can be made by Ferrellgas Partners, Ferrellgas Partners must be in compliance with the consolidated fixed charge coverage ratio covenant under the Ferrellgas Partners indenture. If Ferrellgas Partners is unable to make restricted payments, Ferrellgas Partners will not have the ability to make distributions to Ferrellgas Partners common unitholders.

The covenant requires that the ratio of trailing four quarters EBITDA to interest expense (both as adjusted for certain, specified items) of Ferrellgas Partners be at least 1.75x before a restricted payment (as defined in the indenture) can be made by Ferrellgas Partners. If this ratio were to drop below 1.75x, the indenture allows Ferrellgas Partners to make restricted payments of up to $50.0 million in total over a 16 quarter period while below this ratio. As of July 31, 2018, the ratio was 1.47x. As a result, the $9.8 million distribution paid to common unitholders on September 14, 2018 was taken from the $50.0 million restricted payment limitation, which after considering the $9.8 million deductions taken from the restricted payment limitation as a result of each of the distributions paid in September 2017, December 2017, March 2018 and June 2018, leaves approximately $1.0 million for future restricted payments. Unless the indenture governing the outstanding notes is amended or refinanced, if our consolidated fixed charge coverage ratio does not improve to at least 1.75x and we continue our current quarterly distribution rate of $0.10 per common unit, this covenant will not allow us to make common unit distributions for our quarter ending October 31, 2018 and beyond. In order for the fixed charge coverage ratio to improve to 1.75x as of July 31, 2018, we would have needed to generate approximately $43.7 million of additional EBITDA, or we would have needed to incur approximately $24.9 million less in interest expense. Ferrellgas Partners is presently considering potential solutions to cure the limitation on distributions under the consolidated fixed charge coverage ratio related to the outstanding unsecured bonds due in June 2020. The potential solutions, among others, include a refinancing or a transaction to exchange new bonds for some or all of the bonds due June 2020.

Consolidated fixed charge coverage ratio - Ferrellgas, L.P., the operating partnership

Before a restricted payment (as defined in the indentures governing the outstanding notes of the operating partnership) can be made by the operating partnership to Ferrellgas Partners, the operating partnership must be in compliance with the consolidated fixed charge coverage ratio covenant under the operating partnership indentures. If the operating partnership is unable to make restricted payments, Ferrellgas Partners will not have the ability to make distributions to Ferrellgas Partners common unitholders or make interest payments on Ferrellgas Partners’ unsecured senior notes due 2020.

The covenant requires that the ratio of trailing four quarters EBITDA to interest expense (both as adjusted for certain, specified items) of the operating partnership be at least 1.75x before a restricted payment (as defined in the indentures) can be made by the operating partnership. If this ratio were to drop below 1.75x, the indentures allow the operating partnership to make restricted payments with certain limitations. If it were in violation of the covenant as of July 31, 2018, the operating partnership believes that it would have sufficient capacity within these limitations to satisfy the current restricted payment requirements of Ferrellgas Partners through the maturity of the unsecured senior notes due 2020. As of July 31, 2018, the ratio was 1.87x; the margin allows for approximately $8.4 million of additional interest expense or approximately $14.7 million less EBITDA.

Debt and interest expense reduction and refinancing strategy

Ferrellgas continues to execute on a strategy to further reduce its debt and interest expense. This strategy included entering into the new Senior Secured Credit Facility as mentioned above, amending our accounts receivable securitization facility as discussed in Note G – Accounts and notes receivable, net and accounts receivable securitization, certain asset sales during fiscal 2018, and may include the generation of additional cash flows, organically or through accretive acquisitions, refinancing existing debt agreements, additional asset sales, a reduction in or elimination of Ferrellgas Partners' common unit distributions, the issuance of equity or some form of debt exchange.

Termination of interest rate swaps

In May 2012, Ferrellgas entered into a $140.0 million interest rate swap agreement to hedge against changes in fair value on a portion of its $500.0 million 6.5% fixed rate senior notes due 2021. Ferrellgas received 6.5% and paid a one-month LIBOR plus 4.715%, on the $140.0 million swapped. Ferrellgas accounted for this agreement as a fair value hedge. On May 3, 2018, Ferrellgas terminated this swap and paid the counterparty $4.2 million. Since the interest rate swap terminated involves a hedge of an interest-bearing liability, the senior notes due May 1, 2021, Ferrellgas capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item. See Note L – Derivative instruments and hedging activities for more information.

In May 2012, Ferrellgas entered into a forward interest rate swap agreement to hedge against variability in forecasted interest payments on Ferrellgas’ Previous Facility and collateralized note payable borrowings under the accounts receivable securitization facility. From August 2015 through July 2017, Ferrellgas paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $175.0 million. From August 2017 through May 2018, Ferrellgas paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $100.0 million. Ferrellgas accounted for this agreement as a cash flow hedge. On May 3, 2018, Ferrellgas terminated this interest rate swap. Ferrellgas recorded the immaterial gain immediately to earnings. The cash flows from these contracts are reported as operating activities in the Consolidated Statement of Cash Flows. See Note L – Derivative instruments and hedging activities for more information.

Debt Disclosure [Text Block]

Short-term borrowings

Ferrellgas, L.P. classified a portion of the secured credit facilities borrowings as short-term because they were used to fund working capital needs that management had intended to pay down within the 12 month period following each balance sheet date. As of July 31, 2018 and 2017, $32.8 million and $59.8 million, respectively, were classified as short-term borrowings. For further discussion see the secured credit facilities section below.

Long-term debt

Long-term debt consists of the following:



	2018			2017
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000		$	500,000
Fixed rate, 6.75%, due 2023 (3)	500,000			500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $2,375 and $3,166 at 2018 and 2017, respectively (2)	477,375			478,166
Fair value adjustments related to interest rate swaps	—			471

Secured credit facilities
Variable interest rate, Term Loan, expires May 2023	275,000			—
Variable interest rate, Revolving Facility (net of $59.8 million classified as short-term borrowings at July 31, 2017)	—			185,719

Notes payable
11.2% and 12.0% weighted average interest rate at July 31, 2018 and 2017, respectively, due 2019 to 2025, net of unamortized discount of $977 and $1,128 at July 31, 2018 and 2017, respectively	6,221			5,958
Total debt, excluding unamortized debt issuance and other costs	1,758,596			1,670,314
Unamortized debt issuance and other costs	(28,057		)	(18,466		)
Less: current portion, included in other current liabilities on the consolidated balance sheets	2,402			2,578
Long-term debt	$	1,728,137		$	1,649,270

(1)

During November 2010, Ferrellgas, L.P. issued $500.0 million in aggregate principal amount of new 6.50% senior notes due 2021.These notes are general unsecured senior obligations of Ferrellgas, L.P. and are effectively junior to all future senior secured indebtedness of Ferrellgas, L.P., to the extent of the value of the assets securing the debt, and are structurally subordinated to all existing and future indebtedness and obligations of Ferrellgas, L.P. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on May 1 and November 1 of each year. The outstanding principal amount is due on May 1, 2021. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to May 2019.


(2)	During fiscal 2014, Ferrellgas, L.P. issued $475.0 million in aggregate principal amount of 6.75% senior notes due 2022. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on January 15 and July 15 of each year. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to November 2019.


(3)	During June 2015, Ferrellgas, L.P. issued $500.0 million in aggregate principal amount of 6.75% senior notes due 2023. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to June 2021.

The scheduled annual principal payments on long-term debt are as follows:



For the year ending July 31,	Scheduled annual principal payments
2019	$	2,402
2020	1,671
2021	501,456
2022	475,796
2023	775,426
Thereafter	447
Total	$	1,757,198

Secured credit facilities

On May 4, 2018, Ferrellgas, L.P. entered into a new $575.0 million senior secured credit facility (the "Senior Secured Credit Facility") to replace its previous $575.0 million senior secured credit facility that was scheduled to mature in October 2018 (the "Previous Facility"). The Senior Secured Credit Facility consists of a $300.0 million revolving line of credit (the "Revolving Facility") as well as a $275.0 million term loan (the "Term Loan"), which mature on May 4, 2023. Revolving Facility borrowings bear interest at the Prime Rate + 4.75% and Term Loan borrowings bear interest at LIBOR + 5.75%. The Revolving Facility includes a $125.0 million sublimit for the issuance of letters of credit. Borrowings under the Senior Secured Credit Facility are available for working capital needs, capital expenditures and other general partnership purposes, including the refinancing of existing indebtedness and acquisitions, within certain limits.

The Senior Secured Credit Facility is secured with substantially all of the assets of Ferrellgas, L.P. and its subsidiaries, and Ferrellgas Partners’ and the general partner’s partnership interests in Ferrellgas, L.P., and contains various affirmative and negative covenants and default provisions, as well as requirements with respect to the maintenance of specified financial ratios and limitations on the making of loans and investments.

As of July 31, 2018, Ferrellgas, L.P. had borrowings of $275.0 million under the Term Loan at a rate of 7.86%, which was classified as long-term debt and $32.8 million under the Revolving Facility at a rate of 9.75%, which was classified as short-term borrowings. As of July 31, 2018, Ferrellgas, L.P. had available borrowing capacity under its Revolving Facility of $159.3 million. As of July 31, 2017, Ferrellgas, L.P. had total borrowings outstanding under its Previous Facility of $245.5 million, of which $185.7 million was classified as long-term debt. Borrowings outstanding at July 31, 2017 under the Previous Facility had a weighted average interest rate of 6.0%. As of July 31, 2017, Ferrellgas, L.P. had available borrowing capacity under its Previous Facility of $190.3 million; however additional borrowings were limited to $67.5 million by a covenant under the Previous Facility.

Letters of credit outstanding at July 31, 2018 and 2017 totaled $107.9 million and $139.2 million, respectively, and were used to secure insurance arrangements, product purchases and commodity hedges. At July 31, 2018, Ferrellgas, L.P. had available letter of credit remaining capacity of $17.1 million. At July 31, 2017 Ferrellgas, L.P. had available letter of credit remaining capacity of $60.8 million. Ferrellgas, L.P. incurred commitment fees of $0.7 million, $1.1 million and $1.4 million in fiscal 2018, 2017 and 2016, respectively.

Financial covenants

The agreements governing the operating partnership’s indebtedness contain various covenants that limit Ferrellgas Partners' ability and the ability of specified subsidiaries to, among other things, make restricted payments and incur additional indebtedness. The general partner believes that the most restrictive of these covenants is the consolidated fixed charge coverage ratio, as defined in the indentures governing the outstanding notes of the operating partnership.

Debt and interest expense reduction and refinancing strategy

Ferrellgas, L.P. continues to execute on a strategy to reduce its debt and interest expense. This strategy included entering into the new Senior Secured Credit Facility as mentioned above, amending our accounts receivable securitization facility as discussed in Note G – Accounts and notes receivable, net and accounts receivable securitization, certain asset sales during fiscal 2018, and may include the generation of additional cash flows, organically or through accretive acquisitions, refinancing existing debt agreements, additional asset sales, a reduction in or suspension of Ferrellgas Partners' common unit distributions, the issuance of equity by Ferrellgas Partners or some form of debt exchange.

Termination of interest rate swaps

In May 2012, Ferrellgas, L.P. entered into a $140.0 million interest rate swap agreement to hedge against changes in fair value on a portion of its $500.0 million 6.5% fixed rate senior notes due 2021. Ferrellgas, L.P. received 6.5% and paid a one-month LIBOR plus 4.715%, on the $140.0 million swapped. The operating partnership accounted for this agreement as a fair value hedge. On May 3, 2018, Ferrellgas, L.P. terminated this swap and paid the counterparty $4.2 million. Since the interest rate swap terminated involves a hedge of an interest-bearing liability, the senior notes due May 2021, Ferrellgas, L.P. capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item. See Note L – Derivative instruments and hedging activities for more information.

In May 2012, Ferrellgas, L.P. entered into a forward interest rate swap agreement to hedge against variability in forecasted interest payments on Ferrellgas, L.P.’s Previous Facility and collateralized note payable borrowings under the accounts receivable securitization facility. From August 2015 through July 2017, Ferrellgas, L.P. paid 1.95% and received variable payments based on one-month LIBOR for the notional amount of $175.0 million. From August 2017 through May 2018, Ferrellgas, L.P. paid 1.95% and receive variable payments based on one-month LIBOR for the notional amount of $100.0 million. Ferrellgas, L.P. accounts for this agreement as a cash flow hedge. On May 3, 2018, Ferrellgas, L.P. terminated this interest rate swap. Ferrellgas, L.P. recorded the immaterial gain immediately to earnings. The cash flows from these contracts are reported as operating activities in the Consolidated Statement of Cash Flows. See Note L – Derivative instruments and hedging activities for more information.

Partners' Capital

12 Months Ended

Jul. 31, 2018

Partners' Capital

2017, limited partner units were beneficially owned by the following:



	2018	2017
Public common unitholders (1)	69,612,939	69,612,939
Ferrell Companies (2)	22,529,361	22,529,361
FCI Trading Corp. (3)	195,686	195,686
Ferrell Propane, Inc. (4)	51,204	51,204
James E. Ferrell (5)	4,763,475	4,763,475


(1)	These common units are listed on the New York Stock Exchange under the symbol “FGP.”

(2)

Ferrell Companies is the owner of the general partner and an approximate 23.0% direct owner of Ferrellgas Partner’s common units and thus a related party. Ferrell Companies also beneficially owns 195,686 and 51,204 common units of Ferrellgas Partners held by FCI Trading Corp. (“FCI Trading”) and Ferrell Propane, Inc. (“Ferrell Propane”), respectively, bringing Ferrell Companies’ total beneficial ownership to 23.4%.


(3)	FCI Trading is an affiliate of the general partner and thus a related party.


(4)	Ferrell Propane is controlled by the general partner and thus a related party.

(5)

James E. Ferrell is the Interim Chief Executive Officer and President of our general partner; and is the Chairman of the Board of Directors of our general partner and a related party. JEF Capital Management owns 4,758,859 of these common units and is owned by the James E. Ferrell Revocable Trust Two and other family trusts, all of which James E. Ferrell and/or his family members are the trustees and beneficiaries. James E. Ferrell holds all voting common stock of JEF Capital Management. The remaining 4,616 common units are held by Ferrell Resources Holdings, Inc., which is wholly-owned by the James E. Ferrell Revocable Trust One, for which James E. Ferrell is the trustee and sole beneficiary.

Together these limited partner units represent Ferrellgas Partner’s limited partners’ interest and an effective 98% economic interest in Ferrellgas Partners, exclusive of the general partners’ incentive distribution rights. The general partner has an effective 2% interest in Ferrellgas Partners, excluding incentive distribution rights. Since ongoing distributions have not yet reached the levels required to commence payment of incentive distribution rights to the general partner, distributions to the partners from operations or interim capital transactions will generally be made in accordance with the above percentages. In liquidation, allocations and distributions will be made in accordance with each common unitholder’s positive capital account.

The common units of Ferrellgas Partners represent limited partner interests in Ferrellgas Partners, which give the holders thereof the right to participate in distributions made by Ferrellgas Partners and to exercise the other rights or privileges available to such holders under the Fourth Amended and Restated Agreement of Limited Partnership of Ferrellgas Partners, L.P. dated February 18, 2003, as amended (the “Partnership Agreement”). Under the terms of the Partnership Agreement, holders of common units have limited voting rights on matters affecting the business of Ferrellgas Partners. Generally, persons owning 20% or more of Ferrellgas Partners’ outstanding common units cannot vote; however, this limitation does not apply to those common units owned by the general partner or its “affiliates,” as such term is defined in the Partnership Agreement.

The Partnership Agreement allows the general partner to issue an unlimited number of additional Ferrellgas general and limited partner interests of Ferrellgas Partners for such consideration and on such terms and conditions as shall be established by the general partner without the approval of any unitholders.

Partnership distributions paid by Ferrellgas Partners



	For the year ended July 31,
	2018		2017		2016
Public common unitholders	$	27,846	$	56,561	$	145,666
Ferrell Companies	9,012		18,305		46,184
FCI Trading Corp.	80		160		400
Ferrell Propane, Inc.	20		41		104
James E. Ferrell	1,904		3,869		9,764
General partner	392		797		2,042
	$	39,254	$	79,733	$	204,160

On August 24, 2018, Ferrellgas Partners declared a cash distribution of $0.10 per common unit for the three months ended July 31, 2018, which was paid on September 14, 2018. Included in this cash distribution were the following amounts paid to related parties:



Ferrell Companies	$	2,253
FCI Trading Corp.	20
Ferrell Propane, Inc.	5
James E. Ferrell	476
General partner	98

See additional discussions about transactions with related parties in Note M – Transactions with related parties.

Common unit repurchases

During September 2016, Ferrellgas paid approximately $16.9 million to Jamex Marketing, LLC, and in return received approximately 0.9 million Ferrellgas Partners’ common units, which were cancelled upon receipt, and approximately 23 thousand barrels of crude oil.

During November 2015, Ferrellgas repurchased approximately 2.4 million common units from Jamex Marketing, LLC, for approximately $45.9 million.

Accumulated Other Comprehensive Income (Loss) (“AOCI”)

See Note L – Derivative instruments and hedging activities – for details regarding changes in fair value on risk management financial derivatives recorded within AOCI for the years ended July 31, 2018 and 2017.

General partner’s commitment to maintain its capital account

Ferrellgas’ partnership agreements allows the general partner to have an option to maintain its effective 2% general partner interest concurrent with the issuance of other additional equity.

During fiscal 2018, the general partner made non-cash contributions of $0.3 million to Ferrellgas to maintain its effective 2% general partner interest.

During fiscal 2017, the general partner made cash contributions of $1.7 million and non-cash contributions of $0.4 million to Ferrellgas to maintain its effective 2% general partner interest.

Partners' Capital

Partnership quarterly distributions paid

Ferrellgas, L.P. has paid the following quarterly distributions.



	For the year ended July 31,
	2018		2017		2016
Ferrellgas Partners	$	70,246	$	102,978	$	220,058
General partner	716		1,050		2,246

On August 24, 2018, Ferrellgas, L.P. declared distributions for the three months ended July 31, 2018 to Ferrellgas Partners and the general partner of $9.9 million and $0.1 million, respectively, which were paid on September 14, 2018.

Other Partnership distributions

During September 2016, in connection with Ferrellgas Partners' repurchase of common units, Ferrellgas, L.P distributed $15.9 million to Ferrellgas Partners.

During November 2015, in connection with Ferrellgas Partners' repurchase of common units, Ferrellgas, L.P distributed $46.4 million and $0.5 million to Ferrellgas Partners and the general partner, respectively.

Other partnership contributions

During fiscal 2017, Ferrellgas, L.P. received cash contributions of $166.1 million and $1.7 million from Ferrellgas Partners and the general partner, respectively, which were used to reduce borrowings under the secured credit facility.

See additional discussions about transactions with related parties in Note M – Transactions with related parties.

Accumulated other comprehensive income (loss) (“AOCI”)

General partner’s commitment to maintain its capital account

Ferrellgas, L.P.’s partnership agreement allows the general partner to have an option to maintain its 1.0101% general partner interest concurrent with the issuance of other additional equity.

During fiscal 2018, the general partner made non-cash contributions of $0.1 million to Ferrellgas, L.P. to maintain its 1.0101% general partner interest.

During fiscal 2017, the general partner made cash contributions of $1.7 million and non-cash contributions of $0.2 million to Ferrellgas, L.P. to maintain its 1.0101% general partner interest.

Fair Value Measurements

12 Months Ended

Jul. 31, 2018

Fair Value Measurements

Derivative Financial Instruments

The following table presents Ferrellgas’ financial assets and financial liabilities that are measured at fair value on a recurring basis for each of the fair value hierarchy levels, including both current and noncurrent portions, as of July 31, 2018 and 2017:



	Asset (Liability)
	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)		Total
July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470		$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910	)	$	—	$	(1,910	)

July 31, 2017:
Assets:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	583		$	—	$	583
Commodity derivatives	$	—	$	16,212		$	—	$	16,212
Liabilities:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	(707	)	$	—	$	(707	)
Commodity derivatives	$	—	$	(1,258	)	$	—	$	(1,258	)

Methodology

The fair values of Ferrellgas’ non-exchange traded commodity derivative contracts are based upon indicative price quotations available through brokers, industry price publications or recent market transactions and related market indicators. The fair values of interest rate swap contracts are based upon third-party quotes or indicative values based on recent market transactions.

Other Financial Instruments

The carrying amounts of other financial instruments included in current assets and current liabilities (except for current maturities of long-term debt) approximate their fair values because of their short-term nature. The estimated fair value of various note receivable financial instruments classified in "Other assets, net" on the consolidated balance sheet, are approximately $23.3 million, or $4.2 million less than its carrying amount as of July 31, 2018. The estimated fair value of these notes receivable were calculated using a discounted cash flow method which relied on significant unobservable inputs. At July 31, 2018 and July 31, 2017, the estimated fair value of Ferrellgas’ long-term debt instruments was $1,935.1 million and $1,966.6 million, respectively. Ferrellgas estimates the fair value of long-term debt based on quoted market prices. The fair value of Ferrellgas' consolidated debt obligations is a Level 2 valuation based on the observable inputs used for similar liabilities.

Ferrellgas has other financial instruments such as trade accounts receivable which could expose it to concentrations of credit risk. The credit risk from trade accounts receivable is limited because of a large customer base which extends across many different U.S. markets.

Fair Value Measurements

Derivative Financial Instruments

The following table presents Ferrellgas, L.P.’s financial assets and financial liabilities that are measured at fair value on a recurring basis for each of the fair value hierarchy levels, including both current and noncurrent portions, as of July 31, 2018 and 2017:



	Asset (Liability)
	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)		Total
July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470		$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910	)	$	—	$	(1,910	)

July 31, 2017:
Assets:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	583		$	—	$	583
Commodity derivatives	$	—	$	16,212		$	—	$	16,212
Liabilities:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	(707	)	$	—	$	(707	)
Commodity derivatives	$	—	$	(1,258	)	$	—	$	(1,258	)

Methodology

The fair values of Ferrellgas, L.P.’s non-exchange traded commodity derivative contracts are based upon indicative price quotations available through brokers, industry price publications or recent market transactions and related market indicators. The fair values of interest rate swap contracts are based upon third-party quotes or indicative values based on recent market transactions.

Other Financial Instruments

The carrying amounts of other financial instruments included in current assets and current liabilities (except for current maturities of long-term debt) approximate their fair values because of their short-term nature. The estimated fair value of various note receivable financial instruments classified in "Other assets, net" on the condensed consolidated balance sheets, are approximately $23.3 million, or $4.2 million less than its carrying amount as of July 31, 2018. The estimated fair value of the Jamex note receivable was calculated using a discounted cash flow method which relied on significant unobservable inputs. At July 31, 2018 and July 31, 2017, the estimated fair value of Ferrellgas, L.P.’s long-term debt instruments was $1,591.5 million and $1,645.3 million, respectively. Ferrellgas, L.P. estimates the fair value of long-term debt based on quoted market prices. The fair value of our consolidated debt obligations is a Level 2 valuation based on the observable inputs used for similar liabilities.

Ferrellgas, L.P. has other financial instruments such as trade accounts receivable which could expose it to concentrations of credit risk. The credit risk from trade accounts receivable is limited because of a large customer base which extends across many different U.S. markets.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

12 Months Ended

Jul. 31, 2018

Ferrellgas is exposed to certain market risks related to its ongoing business operations. These risks include exposure to changing commodity prices as well as fluctuations in interest rates. Ferrellgas utilizes derivative instruments to manage its exposure to fluctuations in commodity prices. Of these, the propane commodity derivative instruments are designated as cash flow hedges. Prior to the sale of Bridger Energy, LLC in January 2018, all other commodity derivative instruments neither qualified nor were designated as cash flow hedges, therefore, the change in their fair value are recorded currently in earnings. Ferrellgas may periodically utilize derivative instruments to manage its exposure to fluctuations in interest rates.

Derivative instruments and hedging activity

During the year ended July 31, 2018 and 2017, Ferrellgas did not recognize any gain or loss in earnings related to hedge ineffectiveness and did not exclude any component of financial derivative contract gains or losses from the assessment of hedge effectiveness related to commodity cash flow hedges.

The following tables provide a summary of the fair value of derivatives within Ferrellgas’ consolidated balance sheets as of July 31, 2018 and 2017:

July 31, 2018

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

17,123

Other current liabilities

1,832

Commodity derivatives-propane

Other assets, net

5,347

Other liabilities

Total

22,470

Total

1,910

July 31, 2017

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

11,061

Other current liabilities

415

Commodity derivatives-propane

Other assets, net

4,413

Other liabilities

Interest rate swap agreements

Prepaid expenses and other current assets

583

Other current liabilities

595

Interest rate swap agreements

Other assets, net

—

Other liabilities

112

Derivatives not designated as hedging instruments

Commodity derivatives-crude oil

Prepaid expenses and other current assets

738

Other current liabilities

828

Total

16,795

Total

1,965

Ferrellgas' exchange traded commodity derivative contracts require cash margin deposit as collateral for contracts that are in a negative mark-to-market position. These cash margin deposits will be returned if mark-to-market conditions improve or will be applied against cash settlement when the contracts are settled. Liabilities represent cash margin deposits received by Ferrellgas for contracts that are in a positive mark-to-market position. The following tables provide a summary of cash margin balances as of July 31, 2018 and July 31, 2017, respectively:



	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net	927		Other liabilities	4,235
		$	3,778		$	16,543

	July 31, 2017
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	1,778	Other current liabilities	$	7,729
	Other assets, net	1,631		Other liabilities	3,073
		$	3,409		$	10,802

During fiscal 2018, Ferrellgas terminated the interest rate swaps that were designated as a fair value hedging instrument and cash flow hedging instrument. Upon termination, Ferrellgas paid the counterparty $4.2 million. Since the interest rate swap designated as a fair value hedging instrument that was terminated involves a hedge of an interest-bearing liability, the senior notes due May 1, 2021, Ferrellgas capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item, the 2021 Notes. For information on the interest rate swap terminations, see Note I – Debt. The following table provides a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the years ended July 31, 2018, 2017 and 2016 due to derivatives designated as fair value hedging instruments:



		Amount of Gain Recognized on Derivative						Amount of Interest Expense Recognized on Fixed-Rated Debt (Related Hedged Item)
Derivative Instrument	Location of Gain Recognized on Derivative	For the year ended July 31,						For the year ended July 31,
		2018		2017		2016		2018			2017			2016
Interest rate swap agreements	Interest expense	$	266	$	1,319	$	1,919	$	(6,825	)	$	(9,100	)	$	(9,100	)

The following tables provide a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the years ended July 31, 2018, 2017 and 2016 due to derivatives designated as cash flow hedging instruments:



	For the year ended July 31, 2018
				Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	30,231	Cost of product sold- propane and other gas liquids sales	$	24,714		$	—
Interest rate swap agreements	—		Interest expense	(395		)	—
	$	30,231		$	24,319		$	—



	For the year ended July 31, 2017
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	21,659		Cost of product sold- propane and other gas liquids sales	$	154		$	—
Interest rate swap agreements	866			Interest expense	(2,092		)	—
	$	22,525			$	(1,938	)	$	—

	For the year ended July 31, 2016
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	4,409		Cost of product sold- propane and other gas liquids sales	$	(24,438	)	$	—
Interest rate swap agreements	(2,620		)	Interest expense	(2,864		)	—
	$	1,789			$	(27,302	)	$	—

The following table provides a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the year ended July 31, 2018, 2017 and 2016 due to the change in fair value of derivatives not designated as hedging instruments:



	For the year ended July 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(3,470	)	Cost of sales - midstream operations

	For the year ended July 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(425	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090		Operating expense

	For the year ended July 31, 2016
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	1,084		Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	(4,351		)	Operating expense

The changes in derivatives included in accumulated other comprehensive income (loss) (“AOCI”) for the years ended July 31, 2018, 2017 and 2016 were as follows:



	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2018			2017			2016
Beginning balance	$	14,648		$	(9,815	)	$	(38,906	)
Change in value on risk management commodity derivatives	30,231			21,659			4,409
Reclassification of (gains) and losses of commodity hedges to cost of product sold - propane and other gas liquids sales, net	(24,714		)	(154		)	24,438
Change in value on risk management interest rate derivatives	—			866			(2,620		)
Reclassification of (gains) and losses on interest rate hedges to interest expense	395			2,092			2,864
Ending balance	$	20,560		$	14,648		$	(9,815	)

Ferrellgas expects to reclassify net gains of approximately $15.3 million to earnings during the next 12 months. These net gains are expected to be offset by decreased margins on propane sales commitments Ferrellgas has with its customers that qualify for the normal purchase normal sale exception.

During the years ended July 31, 2018, 2017 and 2016, Ferrellgas had no reclassifications to operations resulting from discontinuance of any cash flow hedges arising from the probability of the original forecasted transactions not occurring within the originally specified period of time defined within the hedging relationship.

As of July 31, 2018, Ferrellgas had financial derivative contracts covering 2.9 million barrels of propane that were entered into as cash flow hedges of forward and forecasted purchases of propane.

Derivative Financial Instruments Credit Risk

Ferrellgas is exposed to credit loss in the event of nonperformance by counterparties to derivative financial and commodity instruments. Ferrellgas’ counterparties principally consist of major energy companies and major U.S. financial institutions. Ferrellgas maintains credit policies with regard to its counterparties that it believes reduce its overall credit risk. These policies include evaluating and monitoring its counterparties’ financial condition, including their credit ratings, and entering into agreements with counterparties that govern credit limits. Certain of these agreements call for the posting of collateral by the counterparty or by Ferrellgas in the forms of letters of credit, parental guarantees or cash. Ferrellgas has concentrations of credit risk associated with derivative financial instruments held by certain derivative financial instrument counterparties. If these counterparties that make up the concentration failed to perform according to the terms of their contracts at July 31, 2018, the maximum amount of loss due to credit risk that, based upon the gross fair values of the derivative financial instruments, Ferrellgas would incur is $5.7 million.

From time to time Ferrellgas enters into derivative contracts that have credit-risk-related contingent features which dictate credit limits based upon Ferrellgas' debt rating. There were no open derivatives with credit-risk-related contingent features as of July 31, 2018.

Derivative Instruments and Hedging Activities

Ferrellgas, L.P. is exposed to certain market risks related to its ongoing business operations. These risks include exposure to changing commodity prices as well as fluctuations in interest rates. Ferrellgas, L.P. utilizes derivative instruments to manage its exposure to fluctuations in commodity prices. Of these, the propane commodity derivative instruments are designated as cash flow hedges. Prior to the sale of Bridger Energy, LLC in January 2018, all other commodity derivative instruments neither qualified nor were designated as cash flow hedges, therefore, changes in their fair value were recorded currently in earnings. Ferrellgas, L.P. may periodically utilizes derivative instruments to manage its exposure to fluctuations in interest rates.

Derivative instruments and hedging activity

During the year ended July 31, 2018 and 2017, Ferrellgas, L.P. did not recognize any gain or loss in earnings related to hedge ineffectiveness and did not exclude any component of financial derivative contract gains or losses from the assessment of hedge effectiveness related to commodity cash flow hedges.

The following tables provide a summary of the fair value of derivatives within Ferrellgas, L.P.’s consolidated balance sheets as of July 31, 2018 and 2017:

July 31, 2018

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

17,123

Other current liabilities

1,832

Commodity derivatives-propane

Other assets, net

5,347

Other liabilities

Total

22,470

Total

1,910

July 31, 2017

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

11,061

Other current liabilities

415

Commodity derivatives-propane

Other assets, net

4,413

Other liabilities

Interest rate swap agreements

Prepaid expenses and other current assets

583

Other current liabilities

595

Interest rate swap agreements

Other assets, net

—

Other liabilities

112

Derivatives not designated as hedging instruments

Commodity derivatives-crude oil

Prepaid expenses and other current assets

738

Other current liabilities

828

Total

16,795

Total

1,965

Ferrellgas, L.P.'s exchange traded commodity derivative contracts require cash margin deposit as collateral for contracts that are in a negative mark-to-market position. These cash margin deposits will be returned if mark-to-market conditions improve or will be applied against cash settlement when the contracts are settled. Liabilities represent cash margin deposits received by Ferrellgas, L.P. for contracts that are in a positive mark-to-market position. The following tables provide a summary of cash margin balances as of July 31, 2018 and July 31, 2017, respectively:



	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net	927		Other liabilities	4,235
		$	3,778		$	16,543

	July 31, 2017
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	1,778	Other current liabilities	$	7,729
	Other assets, net	1,631		Other liabilities	3,073
		$	3,409		$	10,802

During fiscal 2018, Ferrellgas, L.P. terminated the interest rate swaps that were designated as a fair value hedging instrument and cash flow hedging instrument. Upon termination, Ferrellgas, L.P. paid the counterparty $4.2 million. Since the interest rate swap designated as a fair value hedging instrument that was terminated involves a hedge of an interest-bearing liability, the senior notes due May 1, 2021, Ferrellgas, L.P. capitalized the fair value of the hedge at termination of $4.2 million and will amortize the balance on a straight-line basis to interest expense over the remaining useful life of the hedged item, the 2021 Notes. For information on the interest rate swap terminations, see Note I – Debt. The following table provides a summary of the effect on Ferrellgas, L.P.’s consolidated statements of comprehensive income for the years ended July 31, 2018, 2017 and 2016 due to derivatives designated as fair value hedging instruments:



		Amount of Gain Recognized on Derivative						Amount of Interest Expense Recognized on Fixed-Rated Debt (Related Hedged Item)
Derivative Instrument	Location of Gain Recognized on Derivative	For the year ended July 31,						For the year ended July 31,
		2018		2017		2016		2018			2017			2016
Interest rate swap agreements	Interest expense	$	266	$	1,319	$	1,919	$	(6,825	)	$	(9,100	)	$	(9,100	)

The following tables provide a summary of the effect on Ferrellgas, L.P.'s consolidated statements of comprehensive income for the years ended July 31, 2018, 2017 and 2016 due to derivatives designated as cash flow hedging instruments:



	For the year ended July 31, 2018
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	30,231		Cost of product sold- propane and other gas liquids sales	$	24,714		$	—
Interest rate swap agreements	—			Interest expense	(395		)	—
	$	30,231			$	24,319		$	—


	For the year ended July 31, 2017
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	21,659		Cost of product sold- propane and other gas liquids sales	$	154		$	—
Interest rate swap agreements	866			Interest expense	(2,092		)	—
	$	22,525			$	(1,938	)	$	—

	For the year ended July 31, 2016
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	4,409		Cost of product sold- propane and other gas liquids sales	$	(24,438	)	$	—
Interest rate swap agreements	(2,620		)	Interest expense	(2,864		)	—
	$	1,789			$	(27,302	)	$	—

The following table provides a summary of the effect on Ferrellgas, L.P.'s consolidated statements of comprehensive income for the year ended July 31, 2018, 2017 and 2016 due to the change in fair value of derivatives not designated as hedging instruments:



	For the year ended July 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(3,470	)	Cost of sales - midstream operations

	For the year ended July 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(425	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090		Operating expense

	For the year ended July 31, 2016
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	1,084		Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	(4,351		)	Operating expense

The changes in derivatives included in accumulated other comprehensive income (loss) (“AOCI”) for the years ended July 31, 2018, 2017 and 2016 were as follows:



	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2018			2017			2016
Beginning balance	$	14,648		$	(9,815	)	$	(38,906	)
Change in value on risk management commodity derivatives	30,231			21,659			4,409
Reclassification of gains and losses of commodity hedges to cost of product sold - propane and other gas liquids sales, net	(24,714		)	(154		)	24,438
Change in value on risk management interest rate derivatives	—			866			(2,620		)
Reclassification of gains and losses on interest rate hedges to interest expense	395			2,092			2,864
Ending balance	$	20,560		$	14,648		$	(9,815	)

Ferrellgas, L.P. expects to reclassify net gains of approximately $15.3 million to earnings during the next 12 months. These net gains are expected to be offset by decreased margins on propane sales commitments Ferrellgas, L.P. has with its customers that qualify for the normal purchase normal sale exception.

During the years ended July 31, 2018, 2017 and 2016, Ferrellgas, L.P. had no reclassifications to operations resulting from discontinuance of any cash flow hedges arising from the probability of the original forecasted transactions not occurring within the originally specified period of time defined within the hedging relationship.

As of July 31, 2018, Ferrellgas, L.P. had financial derivative contracts covering 2.9 million barrels of propane that were entered into as cash flow hedges of forward and forecasted purchases of propane.

Derivative Financial Instruments Credit Risk

Ferrellgas, L.P. is exposed to credit loss in the event of nonperformance by counterparties to derivative financial and commodity instruments. Ferrellgas, L.P.’s counterparties principally consist of major energy companies and major U.S. financial institutions. Ferrellgas, L.P. maintains credit policies with regard to its counterparties that it believes reduces its overall credit risk. These policies include evaluating and monitoring its counterparties’ financial condition, including their credit ratings, and entering into agreements with counterparties that govern credit limits. Certain of these agreements call for the posting of collateral by the counterparty or by Ferrellgas, L.P. in the forms of letters of credit, parental guarantees or cash. Ferrellgas, L.P. has concentrations of credit risk associated with derivative financial instruments held by certain derivative financial instrument counterparties. If these counterparties that make up the concentration failed to perform according to the terms of their contracts at July 31, 2018, the maximum amount of loss due to credit risk that, based upon the gross fair values of the derivative financial instruments, Ferrellgas, L.P. would incur is $5.7 million.

From time to time Ferrellgas, L.P. enters into derivative contracts that have credit-risk-related contingent features which dictate credit limits based upon Ferrellgas, L.P.’s debt rating. There were no open derivative contracts with credit-risk-related contingent features as of July 31, 2018.

Transactions With Related Parties

12 Months Ended

Jul. 31, 2018

Ferrellgas has no employees and is managed and controlled by its general partner. Pursuant to Ferrellgas’ partnership agreements, the general partner is entitled to reimbursement for all direct and indirect expenses incurred or payments it makes on behalf of Ferrellgas and all other necessary or appropriate expenses allocable to Ferrellgas or otherwise reasonably incurred by its general partner in connection with operating Ferrellgas’ business. These costs primarily include compensation and benefits paid to employees of the general partner who perform services on Ferrellgas’ behalf and are reported in the consolidated statements of operations as follows:



	For the year ended July 31,
	2018		2017		2016
Operating expense	$	243,407	$	228,969	$	230,437

General and administrative expense	$	28,282	$	31,068	$	30,239

During the period in which Jamex Marketing, LLC owned at least 5% of the outstanding common units, we entered into the following transactions: on November 13, 2015, we repurchased approximately 2.4 million common units from Jamex Marketing, LLC, for approximately $45.9 million; and, pursuant to the Jamex TLA, Bridger provided crude oil logistics services for Jamex Marketing, LLC, including the purchase, sale, transportation and storage of crude oil by truck, terminal and pipeline. During 2016, Ferrellgas' total revenues from Jamex was $62.6 million. During 2016, Ferrellgas' total cost of sales from Jamex was $3.4 million. Jamex Marketing, LLC did not own 5% or more of Ferrellgas' outstanding common units during 2018, thus they are not disclosed as a related party during the year.

See additional discussions about transactions with the general partner and related parties in Note J – Partners' deficit.

Ferrellgas, L.P. has no employees and is managed and controlled by its general partner. Pursuant to Ferrellgas, L.P.’s partnership agreement, the general partner is entitled to reimbursement for all direct and indirect expenses incurred or payments it makes on behalf of Ferrellgas, L.P., and all other necessary or appropriate expenses allocable to Ferrellgas, L.P. or otherwise reasonably incurred by its general partner in connection with operating Ferrellgas, L.P.’s business. These costs primarily include compensation and benefits paid to employees of the general partner who perform services on Ferrellgas, L.P.’s behalf and are reported in the consolidated statements of operations as follows:



	For the year ended July 31,
	2018		2017		2016
Operating expense	$	243,407	$	228,969	$	230,437

General and administrative expense	$	28,282	$	31,068	$	30,239

During the period in which Jamex Marketing, LLC owned at least 5% of the outstanding common units, we entered into the following transactions: on November 13, 2015, we repurchased approximately 2.4 million common units from Jamex Marketing, LLC, for approximately $45.9 million; and, pursuant to the Jamex TLA, Bridger provided crude oil logistics services for Jamex Marketing, LLC, including the purchase, sale, transportation and storage of crude oil by truck, terminal and pipeline. During 2016, Ferrellgas' L.P.'s total revenues from Jamex was $62.6 million. During 2016, Ferrellgas' L.P.'s total cost of sales from Jamex was $3.4 million. Jamex Marketing, LLC did not own 5% or more of Ferrellgas Partners' outstanding common units during 2017, thus they are not disclosed as a related party.

See additional discussions about transactions with the general partner and related parties in Note J – Partners' deficit.

Contingencies And Commitments

12 Months Ended

Jul. 31, 2018

Ferrellgas Partners Finance Corp. [Member]

Litigation

Ferrellgas’ operations are subject to all operating hazards and risks normally incidental to handling, storing, transporting and otherwise providing for use by consumers of combustible liquids such as propane and crude oil. As a result, at any given time, Ferrellgas can be threatened with or named as a defendant in various lawsuits arising in the ordinary course of business. Other than as discussed below, Ferrellgas is not a party to any legal proceedings other than various claims and lawsuits arising in the ordinary course of business. It is not possible to determine the ultimate disposition of these matters; however, management is of the opinion that there are no known claims or contingent claims that are reasonably expected to have a material adverse effect on the consolidated financial condition, results of operations and cash flows of Ferrellgas.

Ferrellgas has been named as a defendant, along with a competitor, in putative class action lawsuits filed in multiple jurisdictions. The lawsuits, which were consolidated in the Western District of Missouri on October 16, 2014, allege that Ferrellgas and a competitor coordinated in 2008 to reduce the fill level in barbeque cylinders and combined to persuade a common customer to accept that fill reduction, resulting in increased cylinder costs to direct customers and end-user customers in violation of federal and certain state antitrust laws. The lawsuits seek treble damages, attorneys’ fees, injunctive relief and costs on behalf of the putative class. These lawsuits have been consolidated into one case by a multidistrict litigation panel. The Federal Court for the Western District of Missouri initially dismissed all claims brought by direct and indirect customers other than state law claims of indirect customers under Wisconsin, Maine and Vermont law. The direct customer plaintiffs filed an appeal, which resulted in a reversal of the district court’s dismissal. We filed a petition for a writ of certiorari which was denied. An appeal by the indirect customer plaintiffs resulted in the court appeals affirming the dismissal of the federal claims and remanding the case to the district court to decide whether to exercise supplemental jurisdiction over the remaining state law claims. Ferrellgas believes it has strong defenses to the claims and intends to vigorously defend against the consolidated case. Ferrellgas does not believe loss is probable or reasonably estimable at this time related to the putative class action lawsuit.

Ferrellgas has been named, along with several current and former officers, in several class action lawsuits alleging violations of certain securities laws based on alleged materially false and misleading statements in certain of our public disclosures. The lawsuits, the first of which was filed on October 6, 2016 in the Southern District of New York, seek unspecified compensatory damages. Derivative lawsuits with similar allegations have been filed naming Ferrellgas and several current and former officers and directors as defendants. On April 2, 2018, the securities class action lawsuits were dismissed with prejudice. On April 30, 2018, the plaintiffs filed a notice of appeal to the United States Court of Appeals for the Second Circuit and the parties are preparing appellate briefs. At this time the derivative lawsuits remain stayed by agreement. Ferrellgas believes that it has defenses and will vigorously defend these cases. Ferrellgas does not believe loss is probable or reasonably estimable at this time related to the putative class action lawsuits or the derivative actions.

Ferrellgas and Bridger Logistics, LLC, have been named, along with two former officers, in a lawsuit filed by Eddystone Rail Company ("Eddystone") on February 2, 2017 in the Eastern District of Pennsylvania (the "EDPA Lawsuit"). Eddystone indicated that it has prevailed or settled an arbitration against Jamex Transfer Services (“JTS”), then named Bridger Transfer Services, a former subsidiary of Bridger Logistics, LLC (“Bridger”). The arbitration involved a claim against JTS for money due for deficiency payments under a contract for the use of an Eddystone facility used to offload crude from rail onto barges. Eddystone alleges that Ferrellgas transferred assets out of JTS prior to the sale of the membership interest in JTS to Jamex Transfer Holdings, and that those transfers should be avoided so that the assets can be used to satisfy the amount owed by JTS to Eddystone under the arbitration. Eddystone also alleges that JTS was an “alter ego” of Bridger and Ferrellgas. Ferrellgas believes that Ferrellgas and Bridger have valid defenses to these claims and to Eddystone’s primary claim against JTS on the contract claim. The lawsuit does not specify a specific amount of damages that Eddystone is seeking; however, Ferrellgas believes that the amount of such damage claims, if ultimately owed to Eddystone, could be material to Ferrellgas. Ferrellgas intends to vigorously defend this claim. The lawsuit is in its early stages; as such, management does not currently believe a loss is probable or reasonably estimable at this time. On August 24, 2017, Ferrellgas filed a third-party complaint against JTS, Jamex Transfer Holdings, and other related persons and entities (the "Third-Party Defendants"), asserting claims for breach of contract, indemnification of any losses in the EDPA Lawsuit, tortious interference with contract, and contribution. On June 25, 2018, Ferrellgas entered into an agreement with the Third-Party Defendants which, among other things, resulted in a dismissal of the claims against the Third-Party Defendants from the lawsuit.

Long-term debt-related commitments

Ferrellgas has long and short-term payment obligations under agreements such as senior notes and its secured credit facility. See Note I – Debt – for a description of these debt obligations and a schedule of future maturities.

Operating lease commitments and buyouts

Ferrellgas leases certain property, plant and equipment under non-cancelable and cancelable operating leases. Amounts shown in the table below represent minimum lease payment obligations under Ferrellgas’ third-party operating leases with terms in excess of one year for the periods indicated. These arrangements include the leasing of transportation equipment, property, computer equipment and propane tanks. Ferrellgas accounts for these arrangements as operating leases.

Ferrellgas is required to recognize a liability for the fair value of guarantees. The only material guarantees Ferrellgas has are associated with residual value guarantees of operating leases. Most of the operating leases involving Ferrellgas’ transportation equipment contain residual value guarantees. These transportation equipment lease arrangements are scheduled to expire over the next seven fiscal years. Most of these arrangements provide that the fair value of the equipment will equal or exceed a guaranteed amount, or Ferrellgas will be required to pay the lessor the difference. The fair value of these residual value guarantees was $1.4 million as of July 31, 2018. Although the fair values of the underlying equipment at the end of the lease terms have historically exceeded these guaranteed amounts, the maximum potential amount of aggregate future payments Ferrellgas could be required to make under these leasing arrangements, assuming the equipment is worthless at the end of the lease term, was $8.5 million as of July 31, 2018. Ferrellgas does not know of any event, demand, commitment, trend or uncertainty that would result in a material change to these arrangements.

Operating lease buyouts represent the maximum amount Ferrellgas would pay if it were to exercise its right to buyout the assets at the end of their lease term.

The following table summarizes Ferrellgas’ contractual operating lease commitments and buyout obligations as of July 31, 2018:



	Future minimum rental and buyout amounts by fiscal year
	2019		2020		2021		2022		2023		Thereafter
Operating lease obligations	$	42,356	$	33,137	$	26,142	$	19,173	$	13,867	$	16,624

Operating lease buyouts	$	3,884	$	3,131	$	3,526	$	6,035	$	3,527	$	8,540

Rental expense under these leases totaled $50.7 million, $50.0 million and $49.2 million for fiscal 2018, 2017 and 2016, respectively.

Exit costs

During the year ended July 31, 2018, Ferrellgas recognized exit costs associated with a crude oil storage agreement that is no longer being utilized, primarily due to the various Midstream dispositions described in Note D – Acquisitions, dispositions and other significant transactions, and for which Ferrellgas does not anticipate any future economic benefit. The $11.8 million charge was recorded in “cost of sales - midstream operations” in the consolidated statements of operations. The following provides the activity in the exit costs liability included in "Other liabilities" within the consolidated balance sheets:



	Contract exit costs
July 31, 2017	$	—
Net expense	11,804
Cash payments and other	—
July 31, 2018	$	11,804

Contingencies and commitments

The Finance Corp. serves as co-issuer and co-obligor for debt securities of the Partnership.

The senior unsecured notes contain various restrictive covenants applicable to the Partnership and its subsidiaries, the most restrictive relating to additional indebtedness and restricted payments. As of July 31, 2018, the Partnership is in compliance with all requirements, tests, limitations and covenants related to this debt agreement, except for the consolidated fixed charge coverage ratio.

The indenture governing the outstanding notes of the Partnership includes a consolidated fixed charge coverage ratio test for the incurrence of debt and the making of restricted payments. This covenant requires that the ratio of trailing four quarters EBITDA to interest expense (both as adjusted for certain, specified items) of Ferrellgas Partners be at least 1.75x before a restricted payment (as defined in the indenture) can be made by Ferrellgas Partners. If this ratio were to drop below 1.75x, the indenture allows Ferrellgas Partners to make restricted payments of up to $50.0 million in total over a 16 quarter period while below this ratio. As of July 31, 2018, the ratio was 1.47x. As a result, the $9.8 million distribution paid to common unitholders on September 14, 2018 was taken from the $50.0 million restricted payment limitation, which after considering the $9.8 million deductions taken from the restricted payment limitation as a result of each of the distributions paid in September 2017, December 2017, March 2018 and June 2018, leaves approximately $1.0 million for future restricted payments. Unless the indenture governing the outstanding notes is amended or refinanced, if our consolidated fixed charge coverage ratio does not improve to at least 1.75x and we continue our current quarterly distribution rate of $0.10 per common unit, this covenant will not allow us to make common unit distributions for our quarter ending October 31, 2018 and beyond. Ferrellgas Partners is presently considering potential solutions to cure the limitation on distributions under the consolidated fixed charge coverage ratio related to the outstanding unsecured bonds due in June 2020. The potential solutions, among others, include a refinancing or a transaction to exchange new bonds for some or all of the bonds due June 2020.

Ferrellgas Finance Corp. [Member]

Litigation

Long-term debt-related commitments

Ferrellgas, L.P. has long and short-term payment obligations under agreements such as senior notes and its credit facility. See Note I – Debt – for a description of these debt obligations and a schedule of future maturities.

Operating lease commitments and buyouts

Ferrellgas, L.P. leases certain property, plant and equipment under non-cancelable and cancelable operating leases. Amounts shown in the table below represent minimum lease payment obligations under Ferrellgas, L.P.’s third-party operating leases with terms in excess of one year for the periods indicated. These arrangements include the leasing of transportation equipment, property, computer equipment and propane tanks. Ferrellgas, L.P. accounts for these arrangements as operating leases.

Ferrellgas, L.P. is required to recognize a liability for the fair value of guarantees. The only material guarantees Ferrellgas, L.P. has are associated with residual value guarantees of operating leases. Most of the operating leases involving Ferrellgas, L.P.’s transportation equipment contain residual value guarantees. These transportation equipment lease arrangements are scheduled to expire over the next seven fiscal years. Most of these arrangements provide that the fair value of the equipment will equal or exceed a guaranteed amount, or Ferrellgas, L.P. will be required to pay the lessor the difference. The fair value of these residual value guarantees was $1.4 million as of July 31, 2018. Although the fair values of the underlying equipment at the end of the lease terms have historically exceeded these guaranteed amounts, the maximum potential amount of aggregate future payments Ferrellgas, L.P. could be required to make under these leasing arrangements, assuming the equipment is worthless at the end of the lease term, was $8.5 million as of July 31, 2018. Ferrellgas, L.P. does not know of any event, demand, commitment, trend or uncertainty that would result in a material change to these arrangements.

Operating lease buyouts represent the maximum amount Ferrellgas, L.P. would pay if it were to exercise its right to buyout the assets at the end of their lease term.

The following table summarizes Ferrellgas, L.P.’s contractual operating lease commitments and buyout obligations as of July 31, 2018:



	Future minimum rental and buyout amounts by fiscal year
	2019		2020		2021		2022		2023		Thereafter
Operating lease obligations	$	42,356	$	33,137	$	26,142	$	19,173	$	13,867	$	16,624

Operating lease buyouts	$	3,884	$	3,131	$	3,526	$	6,035	$	3,527	$	8,540

Rental expense under these leases totaled $50.7 million, $50.0 million and $49.2 million for fiscal 2018, 2017 and 2016, respectively.

Exit costs



	Contract exit costs
July 31, 2017	$	—
Net expense	11,804
Cash payments and other	—
July 31, 2018	$	11,804

Net Earnings (Loss) Per Common Unitholders' Interest

Contingencies and commitments

The Finance Corp. serves as co-issuer and co-obligor for debt securities of the Partnership.

The senior notes agreements contain various restrictive covenants applicable to the Partnership and its subsidiaries, the most restrictive relating to additional indebtedness and restricted payments. As of July 31, 2018, the Partnership is in compliance with all requirements, tests, limitations and covenants related to these debt agreements.

Employee Benefits	12 Months Ended
Employee Benefits	Jul. 31, 2018
Employee Benefits	Ferrellgas has no employees and is managed and controlled by its general partner. Ferrellgas assumes all liabilities, which include specific liabilities related to the following employee benefit plans for the benefit of the officers and employees of the general partner. Ferrell Companies makes contributions to the employee stock ownership trust ("ESOT"), which causes a portion of the shares of Ferrell Companies owned by the ESOT to be allocated to employees’ accounts over time. The allocation of Ferrell Companies’ shares to employee accounts causes a non-cash compensation charge to be incurred by Ferrellgas, equivalent to the fair value of such shares allocated. This non-cash compensation charge is reported separately in Ferrellgas’ consolidated statements of operations and thus excluded from operating and general and administrative expenses. The non-cash compensation charges were $13.9 million, $15.1 million and $27.6 million during fiscal 2018, 2017 and 2016, respectively. Ferrellgas is not obligated to fund or make contributions to the ESOT. The general partner and its parent, Ferrell Companies, have a defined contribution profit-sharing plan which includes both profit sharing and matching contribution features. The plan covers substantially all full time employees. The plan, which qualifies under section 401(k) of the Internal Revenue Code, also provides for matching contributions under a cash or deferred arrangement based upon participant salaries and employee contributions to the plan. Matching contributions for fiscal 2018, 2017 and 2016 were $3.7 million, $4.2 million and $4.0 million, respectively. The general partner has a defined benefit plan that provides participants who were covered under a previously terminated plan with a guaranteed retirement benefit at least equal to the benefit they would have received under the terminated plan. Until July 31, 1999, benefits under the terminated plan were determined by years of credited service and salary levels. As of July 31, 1999, years of credited service and salary levels were frozen. The general partner’s funding policy for this plan is to contribute amounts deductible for Federal income tax purposes and invest the plan assets primarily in corporate stocks and bonds, U.S. Treasury bonds and short-term cash investments. During fiscal 2018, 2017 and 2016, other comprehensive income and other liabilities were adjusted by $0.1 million, $0.5 million and $(0.3) million, respectively.
Ferrellgas, L.P. [Member]
Employee Benefits	Ferrellgas, L.P. has no employees and is managed and controlled by its general partner. Ferrellgas, L.P. assumes all liabilities, which include specific liabilities related to the following employee benefit plans for the benefit of the officers and employees of the general partner. Ferrell Companies makes contributions to the employee stock ownership trust ("ESOT"), which causes a portion of the shares of Ferrell Companies owned by the ESOT to be allocated to employees’ accounts over time. The allocation of Ferrell Companies’ shares to employee accounts causes a non-cash compensation charge to be incurred by Ferrellgas, L.P., equivalent to the fair value of such shares allocated. This non-cash compensation charge is reported separately in Ferrellgas, L.P.’s consolidated statements of operations and thus excluded from operating and general and administrative expenses. The non-cash compensation charges were $13.9 million, $15.1 million and $27.6 million during fiscal 2018, 2017 and 2016, respectively. Ferrellgas, L.P. is not obligated to fund or make contributions to the ESOT. The general partner and its parent, Ferrell Companies, have a defined contribution profit-sharing plan which includes both profit sharing and matching contribution features. The plan covers substantially all full time employees. The plan, which qualifies under section 401(k) of the Internal Revenue Code, also provides for matching contributions under a cash or deferred arrangement based upon participant salaries and employee contributions to the plan. Matching contributions for fiscal 2018, 2017 and 2016 were $3.7 million, $4.2 million and $4.0 million, respectively. The general partner has a defined benefit plan that provides participants who were covered under a previously terminated plan with a guaranteed retirement benefit at least equal to the benefit they would have received under the terminated plan. Until July 31, 1999, benefits under the terminated plan were determined by years of credited service and salary levels. As of July 31, 1999, years of credited service and salary levels were frozen. The general partner’s funding policy for this plan is to contribute amounts deductible for Federal income tax purposes and invest the plan assets primarily in corporate stocks and bonds, U.S. Treasury bonds and short-term cash investments. During fiscal 2018, 2017 and 2016, other comprehensive income and other liabilities were adjusted by $0.1 million, $0.5 million and $(0.3) million, respectively.

Net Earnings (Loss) Per Common Unitholders' Interest

12 Months Ended

Jul. 31, 2018

Earnings Per Share [Abstract]

Below is a calculation of the basic and diluted net earnings per common unitholders’ interest in the consolidated statements of operations for the periods indicated. In accordance with guidance issued by the FASB regarding participating securities and the two-class method, Ferrellgas calculates net loss per common unitholders’ interest for each period presented according to distributions declared and participation rights in undistributed earnings, as if all of the earnings or loss for the period had been distributed. Due to the seasonality of Ferrellgas' business, the dilutive effect of the two-class method typically impacts only the three months ending January 31. In periods with undistributed earnings above certain levels, the calculation according to the two-class method results in an increased allocation of undistributed earnings to the general partner and a dilution of the earnings to the limited partners as follows.



	Ratio of total distributions payable to:
Quarterly distribution per common unit	Common unitholder		General partner
$0.56 to $0.63	86.9	%	13.1	%
$0.64 to $0.82	76.8	%	23.2	%
$0.83 and above	51.5	%	48.5	%

There was not a dilutive effect resulting from this guidance on basic and diluted net earnings per common unitholders’ interest for fiscal 2018, 2017 and 2016.

In periods with net losses, the allocation of the net losses to the limited partners and the general partner will be determined based on the same allocation basis specified in the Ferrellgas Partners’ partnership agreement that would apply to periods in which there were no undistributed earnings. Additionally, in periods with net losses, there are no dilutive securities.



	For the year ended July 31,
	2018			2017			2016
Common unitholders’ interest in net loss	$	(252,035	)	$	(53,665	)	$	(658,761	)

Weighted average common units outstanding (in thousands)	97,152.7			97,229.5			98,682.8

Dilutive securities	—			—			—

Weighted average common units outstanding plus dilutive securities	97,152.7			97,229.5			98,682.8

Basic and diluted net loss per common unitholders’ interest	$	(2.59	)	$	(0.55	)	$	(6.68	)

Segment Reporting Segment Reporting

12 Months Ended

Jul. 31, 2018

Segment Reporting Disclosure

As of July 31, 2018, Ferrellgas has one reportable operating segment: propane operations and related equipment sales. All remaining activities are included in Corporate and other. (See Note D – Acquisitions, dispositions and other significant transactions.)

The chief operating decision maker evaluates the operating segments using an Adjusted EBITDA performance measure which is based on earnings (loss) before income tax expense (benefit), interest expense, depreciation and amortization expense, non-cash employee stock ownership plan compensation charge, non-cash stock-based compensation charge, asset impairments, loss sale of assets and disposals, other income (expense), net, change in fair value of contingent consideration, severance costs, litigation fees and settlements, acquisition and transition expenses, unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments, exit costs associated with contracts related to the Midstream dispositions and net earnings (loss) attributable to noncontrolling interests. This performance measure is not a GAAP measure, however the components are computed using amounts that are determined in accordance with GAAP. A reconciliation of this performance measure to net loss attributable to Ferrellgas Partners L.P., which is its nearest comparable GAAP measure, is included in the tables below. In management's evaluation of performance, certain costs, such as compensation for administrative staff and executive management, are not allocated by segment and, accordingly, the following reportable segment results do not include such unallocated costs. The accounting policies of the operating segments are otherwise the same as those described in the summary of significant accounting policies in Note B – Summary of significant accounting policies.

Assets reported within a segment are those assets that can be identified to a segment and primarily consist of trade receivables, property, plant and equipment, inventories, identifiable intangible assets and goodwill. Cash, certain prepaid assets and other assets are not allocated to segments. Although Ferrellgas can and does identify long-lived assets such as property, plant and equipment and identifiable intangible assets to reportable segments, Ferrellgas does not allocate the related depreciation and amortization to the segment as management evaluates segment performance exclusive of these non-cash charges.

The propane operations and related equipment sales segment primarily includes the distribution and sale of propane and related equipment and supplies with concentrations in the Midwest, Southeast, Southwest and Northwest regions of the United States. Sales from propane distribution are generated principally from transporting propane purchased from third parties to propane distribution locations and then to tanks on customers’ premises or to portable propane tanks delivered to nationwide and local retailers. Sales from portable tank exchanges, nationally branded under the name Blue Rhino, are generated through a network of independent and partnership-owned distribution outlets.

Until April 2018, Ferrellgas reported two reportable segments which included propane operations and related equipment sales segment and midstream operations. During July 2018, Ferrellgas sold substantially all of the midstream operations. As a result of a change in the way management is evaluating results and allocating resources, results of the Midstream operations business are now included in the Corporate and other operations for all periods presented and our only reportable segment is Propane operations and related equipment sales.

Following is a summary of segment information for the years ended July 31, 2018, 2017 and 2016.



	Year Ended July 31, 2018
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,790,823	$	282,319		$	2,073,142
Direct costs (1)	1,514,755		316,468			1,831,223
Adjusted EBITDA	$	276,068	$	(34,149	)	$	241,919

	Year Ended July 31, 2017
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,463,574	$	466,703		$	1,930,277
Direct costs (1)	1,198,150		502,064			1,700,214
Adjusted EBITDA	$	265,424	$	(35,361	)	$	230,063

	Year Ended July 31, 2016
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,414,129	$	625,238		$	2,039,367
Direct costs (1)	1,127,382		567,255			1,694,637
Adjusted EBITDA	$	286,747	$	57,983		$	344,730

(1) Direct costs are comprised of "cost of sales-propane and other gas liquids sales", "cost of sales-other", "cost of sales-midstream operations", "operating expense", "general and administrative expense", and "equipment lease expense" less "severance charge", "litigation fees and settlements", "non-cash stock compensation charge", "asset impairments", "change in fair value of contingent consideration", "acquisition and transition expenses", "exit costs associated with contracts related to the Midstream dispositions" and "unrealized (non-cash) losses on changes in fair value of derivatives not designated as hedging instruments".

Following is a reconciliation of Ferrellgas' total segment performance measure to consolidated net earnings:



	Year Ended July 31,
	2018			2017			2016
Net loss attributable to Ferrellgas Partners, L.P.	$	(254,581	)	$	(54,207	)	$	(665,415	)
Income tax benefit	(2,678		)	(1,143		)	(36		)
Interest expense	168,467			152,485			137,937
Depreciation and amortization expense	101,795			103,351			150,513
EBITDA	13,003			200,486			(377,001		)
Non-cash employee stock ownership plan compensation charge	13,859			15,088			27,595
Non-cash stock-based compensation charge	—			3,298			9,324
Asset impairments	10,005			—			658,118
Loss on asset sales and disposals	187,399			14,457			30,835
Other income, net	(928		)	(1,474		)	(110		)
Change in fair value of contingent consideration	—			—			(100		)
Severance costs	1,663			1,959			1,453
Litigation fees and settlements	6,065			—			—
Acquisition and transition expenses	—			—			99
Unrealized (non-cash) loss (gains) on changes in fair value of derivatives	1,293			(3,457		)	1,137
Exit costs associated with contracts - Midstream dispositions	11,804			—			—
Net loss attributable to noncontrolling interest	(2,244		)	(294		)	(6,620		)
Adjusted EBITDA	$	241,919		$	230,063		$	344,730

Following are total assets by segment:



	July 31,		July 31,
	2018		2017
Assets
Propane operations and related equipment sales	$	1,196,084	$	1,194,905
Corporate and other	167,197		415,064
Total consolidated assets	$	1,363,281	$	1,609,969

Following are capital expenditures by segment (unaudited):



	Year Ended July 31, 2018
	Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance	$	23,979	$	3,584	$	27,563
Growth	51,229		1,255		52,484
Total	$	75,208	$	4,839	$	80,047

	Year Ended July 31, 2017
	Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance	$	13,330	$	3,808	$	17,138
Growth	28,912		315		29,227
Total	$	42,242	$	4,123	$	46,365

	Year Ended July 31, 2016
	Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance	$	13,487	$	3,390	$	16,877
Growth	32,906		63,152		96,058
Total	$	46,393	$	66,542	$	112,935

Segment Reporting Disclosure

As of July 31, 2018, Ferrellgas, L.P. has one reportable operating segment: propane operations and related equipment sales. All remaining activities are included in Corporate and other. (See Note D – Acquisitions, dispositions and other significant transactions.)

The chief operating decision maker evaluates the operating segments using an Adjusted EBITDA performance measure which is based on earnings (loss) before income tax expense (benefit), interest expense, depreciation and amortization expense, non-cash employee stock ownership plan compensation charge, non-cash stock-based compensation charge, asset impairments, loss on asset sales and disposals, other income (expense), net, change in fair value of contingent consideration, severance costs, litigation fees and settlements, acquisition and transition expenses, unrealized (non-cash) losses (gains) on changes in fair value of derivatives not designated as hedging instruments and exit costs associated with contracts related to the Midstream dispositions. This performance measure is not a GAAP measure, however, the components are computed using amounts that are determined in accordance with GAAP. A reconciliation of this performance measure to net earnings, which is its nearest comparable GAAP measure, is included in the tables below. In management's evaluation of performance, certain costs, such as compensation for administrative staff and executive management, are not allocated by segment and, accordingly, the following reportable segment results do not include such unallocated costs. The accounting policies of the operating segments are otherwise the same as those described in the summary of significant accounting policies in Note B – Summary of significant accounting policies.

Assets reported within a segment are those assets that can be identified to a segment and primarily consist of trade receivables, property, plant and equipment, inventories, identifiable intangible assets and goodwill. Cash, certain prepaid assets and other assets are not allocated to segments. Although Ferrellgas, L.P. can and does identify long-lived assets such as property, plant and equipment and identifiable intangible assets to reportable segments, Ferrellgas, L.P. does not allocate the related depreciation and amortization to the segment as management evaluates segment performance exclusive of these non-cash charges.

Until April 2018, Ferrellgas, L.P. reported two reportable segments which included propane operations and related equipment sales segment and the midstream operations segment. During July 2018, Ferrellgas, L.P. sold substantially all of the midstream operations. As a result of a change in the way management is evaluating results and allocating resources, results of the midstream operations business are now included in the Corporate and other operations for all periods presented and our only reportable segment is Propane operations and related equipment sales.

Following is a summary of segment information for the years ended July 31, 2018, 2017 and 2016.



	Year Ended July 31, 2018
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,790,823	$	282,319		$	2,073,142
Direct costs (1)	1,514,755		316,331			1,831,086
Adjusted EBITDA	$	276,068	$	(34,012	)	$	242,056

	Year Ended July 31, 2017
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,463,574	$	466,703		$	1,930,277
Direct costs (1)	1,198,150		501,925			1,700,075
Adjusted EBITDA	$	265,424	$	(35,222	)	$	230,202

	Year Ended July 31, 2016
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,414,129	$	625,238		$	2,039,367
Direct costs (1)	1,127,382		566,735			1,694,117
Adjusted EBITDA	$	286,747	$	58,503		$	345,250

Following is a reconciliation of Ferrellgas, L.P.'s total segment performance measure to consolidated net earnings:



	Year Ended July 31
	2018			2017			2016

Net loss	$	(222,146	)	$	(29,059	)	$	(655,391	)
Income tax benefit	(2,699		)	(1,149		)	(41		)
Interest expense	133,946			127,188			121,818
Depreciation and amortization expense	101,795			103,351			150,513
EBITDA	10,896			200,331			(383,101		)
Non-cash employee stock ownership plan compensation charge	13,859			15,088			27,595
Non-cash stock-based compensation charge	—			3,298			9,324
Asset impairments	10,005			—			658,118
Loss on asset sales and disposals	187,399			14,457			30,835
Other income, net	(928		)	(1,474		)	(110		)
Change in fair value of contingent consideration	—			—			(100		)
Severance costs	1,663			1,959			1,453
Litigation fees and settlements	6,065			—			—
Acquisition and transition expenses	—			—			99
Unrealized (non-cash) loss (gains) on changes in fair value of derivatives	1,293			(3,457		)	1,137
Exit costs associated with contracts - Midstream dispositions	11,804			—			—
Adjusted EBITDA	$	242,056		$	230,202		$	345,250

Following are total assets by segment:



	July 31,		July 31,
	2018		2017
Assets
Propane operations and related equipment sales	$	1,196,084	$	1,194,905
Corporate and other	167,162		415,043
Total consolidated assets	$	1,363,246	$	1,609,948

Following are capital expenditures by segment (unaudited):



	Year Ended July 31, 2018
		Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance		$	23,979	$	3,584	$	27,563
Growth		51,229		1,255		52,484
Total		$	75,208	$	4,839	$	80,047

	Year Ended July 31, 2017
		Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance		$	13,330	$	3,808	$	17,138
Growth		28,912		315		29,227
Total		$	42,242	$	4,123	$	46,365

	Year Ended July 31, 2016
		Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance		$	13,487	$	3,390	$	16,877
Growth		32,906		63,152		96,058
Total		$	46,393	$	66,542	$	112,935

Quarterly Data (Unaudited)

12 Months Ended

Jul. 31, 2018

Quarterly Data

The following summarized unaudited quarterly data includes all adjustments (consisting only of normal recurring adjustments, with the exception of those items indicated below), which Ferrellgas considers necessary for a fair presentation. Due to the seasonality of the propane distribution business, first and fourth quarter Revenues, gross margin from propane and other gas liquids sales, Net earnings (loss) attributable to Ferrellgas Partners and common unitholders’ interest in net earnings (loss) are consistently less than the second and third quarter results. Other factors affecting the results of operations include competitive conditions, demand for product, timing of acquisitions, variations in the weather and fluctuations in propane prices. The sum of basic and diluted net earnings (loss) per common unitholders’ interest by quarter may not equal the basic and diluted net earnings (loss) per common unitholders’ interest for the year due to variations in the weighted average units outstanding used in computing such amounts.



For the year ended July 31, 2018	First quarter			Second quarter			Third quarter		Fourth quarter
Revenues	$	454,655		$	755,156		$	515,810	$	347,521
Gross margin from propane and other gas liquids sales (a)	123,243			229,321			190,883		126,115
Gross margin from midstream operations (b)	12,635			10,209			8,077		(4,161		)
Net earnings (loss) (c)	(48,316		)	(1,774		)	11,062		(217,797		)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.	(47,915		)	(1,843		)	10,861		(215,684		)
Common unitholders’ interest in net earnings (loss)	(47,436		)	(1,824		)	10,752		(213,527		)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.49	)	$	(0.02	)	$	0.11	$	(2.20	)


For the year ended July 31, 2017	First quarter			Second quarter			Third quarter		Fourth quarter
Revenues	$	379,542		$	579,250		$	538,109	$	433,376
Gross margin from propane and other gas liquids sales (a)	123,187			202,346			171,950		126,774
Gross margin from midstream operations (b)	13,402			9,763			7,909		6,190
Net earnings (loss)	(43,471		)	38,528			6,691		(56,249		)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.	(43,073		)	38,098			6,536		(55,768		)
Common unitholders’ interest in net earnings (loss)	(42,642		)	37,717			6,470		(55,210		)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.44	)	$	0.39		$	0.07	$	(0.57	)


For the year ended July 31, 2016	First quarter			Second quarter			Third quarter		Fourth quarter
Revenues	$	471,146		$	649,238		$	509,472	$	409,511
Gross margin from propane and other gas liquids sales (a)	123,550			202,027			186,668		125,690
Gross margin from midstream operations (b)	40,066			39,890			33,572		40,476
Net earnings (loss) (c)	(80,566		)	57,755			18,918		(668,142		)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.	(79,793		)	57,127			18,685		(661,434		)
Common unitholders’ interest in net earnings (loss)	(78,995		)	56,556			18,498		(654,820		)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.79	)	$	0.58		$	0.19	$	(6.68	)


(a)	Gross margin from “Propane and other gas liquids sales” represents “Revenues - propane and other gas liquids sales” less “Cost of sales – propane and other gas liquids sales.”


(b)	Gross margin from "Midstream operations" represents "Revenues - midstream operations" less "Cost of sales - midstream operations."


(c)	Includes asset impairment charges of $10.0 million in the second quarter of fiscal 2018 and $29.3 million and $628.8 million in the first and fourth quarters of fiscal 2016, respectively.

Quarterly Data



For the year ended July 31, 2018	First quarter			Second quarter		Third quarter		Fourth quarter
Revenues	$	454,655		$	755,156	$	515,810	$	347,521
Gross margin from propane and other gas liquids sales (a)	123,243			229,321		190,883		126,115
Gross margin from midstream operations (b)	12,635			10,209		8,077		(4,161		)
Net earnings (loss) (c)	$	(39,699	)	$	6,847	$	19,840	$	(209,134	)


For the year ended July 31, 2017	First quarter			Second quarter		Third quarter		Fourth quarter
Revenues	$	379,542		$	579,250	$	538,109	$	433,376
Gross margin from propane and other gas liquids sales (a)	123,187			202,346		171,950		126,774
Gross margin from midstream operations (b)	13,402			9,763		7,909		6,190
Net earnings (loss)	$	(39,440	)	$	42,600	$	15,395	$	(47,614	)


For the year ended July 31, 2016	First quarter			Second quarter		Third quarter		Fourth quarter
Revenues	$	471,146		$	649,238	$	509,472	$	409,511
Gross margin from propane and other gas liquids sales (a)	123,550			202,027		186,668		125,690
Gross margin from midstream operations (b)	40,066			39,890		33,572		40,476
Net earnings (loss) (c)	$	(76,536	)	$	62,187	$	23,049	$	(664,091	)


(a)	Gross margin from “Propane and other gas liquids sales” represents “Revenues - propane and other gas liquids sales” less “Cost of sales – propane and other gas liquids sales.”


(b)	Gross margin from "Midstream operations" represents "Revenues - midstream operations" less "Cost of sales - midstream operations."


(c)	Includes asset impairment charges of $10.0 million in the second quarter of fiscal 2018 and $29.3 million and $628.8 million in the first and fourth quarters of fiscal 2016, respectively.

Income Taxes	12 Months Ended
Income Taxes	Jul. 31, 2018
Ferrellgas Partners Finance Corp. [Member]
Income Taxes	Income taxes Income taxes have been computed separately as the Finance Corp. files its own income tax return. Deferred income taxes are provided as a result of temporary differences between financial and tax reporting using the asset/liability method. Deferred income taxes are recognized for the tax consequences of temporary differences between the financial statement carrying amounts and tax basis of existing assets and liabilities. Due to the inability of the Finance Corp. to utilize the deferred tax benefit of $7,188 associated with the net operating loss carryforward of $26,621 generated prior to fiscal 2018, which expire at various dates through July 31, 2037, a valuation allowance has been provided on the full amount of the deferred tax asset. The net operating loss carryforwards generated during and after fiscal 2018 are carried forward indefinitely. Accordingly, there is no net deferred tax benefit for fiscal 2018, 2017 or 2016, and there is no net deferred tax asset as of July 31, 2018 and 2017.
Ferrellgas Finance Corp. [Member]
Income Taxes	Income taxes Income taxes have been computed separately as the Finance Corp. files its own income tax return. Deferred income taxes are provided as a result of temporary differences between financial and tax reporting using the asset/liability method. Deferred income taxes are recognized for the tax consequences of temporary differences between the financial statement carrying amounts and tax basis of existing assets and liabilities. Due to the inability of the Finance Corp. to utilize the deferred tax benefit of $19,263 associated with the net operating loss carryforward of $71,344 generated prior to fiscal 2018, which expires at various dates through July 31, 2037, a valuation allowance has been provided on the full amount of the deferred tax asset. The net operating loss carryforwards generated during and after fiscal 2018 are carried forward indefinitely. Accordingly, there is no net deferred tax benefit for fiscal 2018, 2017 or 2016, and there is no net deferred tax asset as of July 31, 2018 and 2017.

Guarantor financial information Guarantor financial information

12 Months Ended

Jul. 31, 2018

Guarantor financial information

The $500.0 million aggregate principal amount of registered 6.75% senior notes due 2023 co-issued by Ferrellgas, L.P. and Ferrellgas Finance Corp. are fully and unconditionally and joint and severally guaranteed by all of Ferrellgas, L.P.’s 100% owned subsidiaries except: i) Ferrellgas Finance Corp; ii) certain special purposes subsidiaries formed for use in connection with our accounts receivable securitization; and iii) foreign subsidiaries. Guarantees of these senior notes will be released under certain circumstances, including (i) in connection with any sale or other disposition of (a) all or substantially all of the assets of a guarantor or (b) all of the capital stock of such guarantor (including by way of merger or consolidation), in each case, to a person that is not Ferrellgas, L.P. or a restricted subsidiary of Ferrellgas, L.P., (ii) if Ferrellgas, L.P. designates any restricted subsidiary that is a guarantor as an unrestricted subsidiary, (iii) upon defeasance or discharge of the notes, (iv) upon the liquidation or dissolution of such guarantor, or (v) at such time as such guarantor ceases to guarantee any other indebtedness of either of the issuers and any other guarantor.

The guarantor financial information discloses in separate columns the financial position, results of operations and the cash flows of Ferrellgas, L.P. (Parent), Ferrellgas Finance Corp. (co-issuer), Ferrellgas L.P.’s guarantor subsidiaries on a combined basis, and Ferrellgas L.P.’s non-guarantor subsidiaries on a combined basis. The dates and the periods presented in the guarantor financial information are consistent with the periods presented in Ferrellgas, L.P.’s consolidated financial statements.



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(in thousands)
	As of July 31, 2018
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	119,133		$	1	$	174		$	—	$	—		$	119,308
Accounts and notes receivable	(3,420		)	—		9,395			120,079		—			126,054
Intercompany receivables	15,660			—		—			—		(15,660		)	—
Inventories	83,694			—		—			—		—			83,694
Prepaid expenses and other current assets	34,050			—		775			5		—			34,830
Total current assets	249,117			1		10,344			120,084		(15,660		)	363,886

Property, plant and equipment, net	557,689			—		34			—		—			557,723
Goodwill	246,098			—		—			—		—			246,098
Intangible assets, net	120,951			—		—			—		—			120,951
Investments in consolidated subsidiaries	59,937			—		—			—		(59,937		)	—
Other assets, net	63,411			—		9,961			1,216		—			74,588
Total assets	$	1,297,203		$	1	$	20,339		$	121,300	$	(75,597	)	$	1,363,246

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Current liabilities:
Accounts payable	$	45,171		$	—	$	1,547		$	102	$	—		$	46,820
Short-term borrowings	32,800			—		—			—		—			32,800
Collateralized note payable	—			—		—			58,000		—			58,000
Intercompany payables	—			—		(143		)	15,803		(15,660		)	—
Other current liabilities	131,702			—		6,036			353		—			138,091
Total current liabilities	209,673			—		7,440			74,258		(15,660		)	275,711

Long-term debt	1,728,137			—		—			—		—			1,728,137
Other liabilities	39,471			—		5			—		—			39,476
Contingencies and commitments

Partners' capital (deficit):
Partners' equity (deficit)	(700,811		)	1		12,894			47,042		(59,937		)	(700,811		)
Accumulated other comprehensive income	20,733			—		—			—		—			20,733
Total partners' capital (deficit)	(680,078		)	1		12,894			47,042		(59,937		)	(680,078		)
Total liabilities and partners' capital (deficit)	$	1,297,203		$	1	$	20,339		$	121,300	$	(75,597	)	$	1,363,246



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEETS
(in thousands)
	As of July 31, 2017
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	5,327		$	1	$	373		$	—		$	—		$	5,701
Accounts and notes receivable	(3,132		)	—		58,618			109,598			—			165,084
Intercompany receivables	39,877			—		—			—			(39,877		)	—
Inventories	78,963			—		13,589			—			—			92,552
Prepaid expenses and other current assets	26,106			—		7,314			6			—			33,426
Total current assets	147,141			1		79,894			109,604			(39,877		)	296,763

Property, plant and equipment, net	537,582			—		194,341			—			—			731,923
Goodwill	246,098			—		10,005			—			—			256,103
Intangible assets, net	128,209			—		122,893			—			—			251,102
Intercompany receivables	450,000			—		—			—			(450,000		)	—
Investments in consolidated subsidiaries	(53,915		)	—		—			—			53,915			—
Other assets, net	35,862			—		37,618			577			—			74,057
Total assets	$	1,490,977		$	1	$	444,751		$	110,181		$	(435,962	)	$	1,609,948

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Current liabilities:
Accounts payable	$	44,026		$	—	$	41,345		$	190		$	—		$	85,561
Short-term borrowings	59,781			—		—			—			—			59,781
Collateralized note payable	—			—		—			69,000			—			69,000
Intercompany payables	—			—		41,645			(1,768		)	(39,877		)	—
Other current liabilities	118,039			—		3,776			201			—			122,016
Total current liabilities	221,846			—		86,766			67,623			(39,877		)	336,358

Long-term debt	1,649,139			—		450,131			—			(450,000		)	1,649,270
Other liabilities	26,790			—		4,300			28			—			31,118
Contingencies and commitments

Partners' capital (deficit):
Partners' equity (deficit)	(421,562		)	1		(96,446		)	42,530			53,915			(421,562		)
Accumulated other comprehensive income	14,764			—		—			—			—			14,764
Total partners' capital (deficit)	(406,798		)	1		(96,446		)	42,530			53,915			(406,798		)
Total liabilities and partners' capital (deficit)	$	1,490,977		$	1	$	444,751		$	110,181		$	(435,962	)	$	1,609,948



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
(in thousands)

	For the year ended July 31, 2018
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Revenues:
Propane and other gas liquids sales	$	1,642,155		$	—		$	821		$	—		$	—		$	1,642,976
Midstream operations	—			—			282,319			—			—			282,319
Other	72,954			—			74,893			—			—			147,847
Total revenues	1,715,109			—			358,033			—			—			2,073,142

Costs and expenses:
Cost of sales - propane and other gas liquids sales	972,467			—			947			—			—			973,414
Cost of sales - midstream operations	—			—			255,559			—			—			255,559
Cost of sales - other	10,111			—			58,543			—			—			68,654
Operating expense	436,962			—			37,617			4,755			(7,586		)	471,748
Depreciation and amortization expense	75,163			—			26,317			315			—			101,795
General and administrative expense	48,337			5			5,922			—			—			54,264
Equipment lease expense	27,939			—			333			—			—			28,272
Non-cash employee stock ownership plan compensation charge	13,859			—			—			—			—			13,859
Asset impairments	—			—			10,005			—			—			10,005
Loss on asset sales and disposals	8,978			—			178,421			—			—			187,399

Operating income (loss)	121,293			(5		)	(215,631		)	(5,070		)	7,586			(91,827		)

Interest expense	(86,646		)	—			(43,247		)	(4,053		)	—			(133,946		)
Other income (expense), net	(234		)	—			1,162			7,586			(7,586		)	928

Earnings (loss) before income taxes	34,413			(5		)	(257,716		)	(1,537		)	—			(224,845		)

Income tax expense (benefit)	222			—			(2,921		)	—			—			(2,699		)
Equity in earnings (loss) of subsidiaries	(256,337		)	—			—			—			256,337			—

Net earnings (loss)	(222,146		)	(5		)	(254,795		)	(1,537		)	256,337			(222,146		)

Other comprehensive income	5,969			—			—			—			—			5,969

Comprehensive income (loss)	$	(216,177	)	$	(5	)	$	(254,795	)	$	(1,537	)	$	256,337		$	(216,177	)



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
(in thousands)

	For the year ended July 31, 2017
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Revenues:
Propane and other gas liquids sales	$	1,318,412		$	—		$	—		$	—		$	—		$	1,318,412
Midstream operations	—			—			466,703			—			—			466,703
Other	69,962			—			75,200			—			—			145,162
Total revenues	1,388,374			—			541,903			—			—			1,930,277

Costs and expenses:
Cost of sales - propane and other gas liquids sales	694,155			—			—			—			—			694,155
Cost of sales - midstream operations	—			—			429,439			—			—			429,439
Cost of sales - other	8,473			—			58,794			—			—			67,267
Operating expense	398,584			—			38,188			95			(4,455		)	432,412
Depreciation and amortization expense	72,919			—			30,183			249			—			103,351
General and administrative expense	44,810			5			4,663			—			—			49,478
Equipment lease expense	28,560			—			564			—			—			29,124
Non-cash employee stock ownership plan compensation charge	15,088			—			—			—			—			15,088
Loss on asset sales and disposals	9,198			—			5,259			—			—			14,457

Operating income (loss)	116,587			(5		)	(25,187		)	(344		)	4,455			95,506

Interest expense	(80,866		)	—			(43,839		)	(2,480		)	(3		)	(127,188		)
Other income (expense), net	850			—			624			4,452			(4,452		)	1,474

Earnings (loss) before income taxes	36,571			(5		)	(68,402		)	1,628			—			(30,208		)

Income tax expense (benefit)	217			—			(1,366		)	—			—			(1,149		)
Equity in earnings (loss) of subsidiaries	(65,413		)	—			—			—			65,413			—

Net earnings (loss)	(29,059		)	(5		)	(67,036		)	1,628			65,413			(29,059		)

Other comprehensive income	25,324			—			—			—			—			25,324

Comprehensive income (loss)	$	(3,735	)	$	(5	)	$	(67,036	)	$	1,628		$	65,413		$	(3,735	)



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
(in thousands)

	For the year ended July 31, 2016
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated

Revenues:
Propane and other gas liquids sales	$	1,202,368		$	—		$	—		$	—		$	—		$	1,202,368
Midstream operations	—			—			625,238			—			—			625,238
Other	73,200			—			138,561			—			—			211,761
Total revenues	1,275,568			—			763,799			—			—			2,039,367

Costs and expenses:
Cost of sales - propane and other gas liquids sales	564,433			—			—			—			—			564,433
Cost of sales - midstream operations	(1,545		)	—			472,779			—			—			471,234
Cost of sales - other	8,867			—			117,370			—			—			126,237
Operating expense	399,680			—			58,789			4,028			(3,319		)	459,178
Depreciation and amortization expense	75,059			—			75,212			242			—			150,513
General and administrative expense	50,592			7			5,516			—			—			56,115
Equipment lease expense	28,322			—			511			—			—			28,833
Non-cash employee stock ownership plan compensation charge	27,595			—			—			—			—			27,595
Asset impairments	—			—			658,118			—			—			658,118
Loss on asset sales and disposals	9,180			—			21,655			—			—			30,835

Operating income (loss)	113,385			(7		)	(646,151		)	(4,270		)	3,319			(533,724		)

Interest expense	(77,493		)	—			(42,325		)	(2,186		)	186			(121,818		)
Other income (expense), net	110			—			—			3,505			(3,505		)	110

Earnings (loss) before income taxes	36,002			(7		)	(688,476		)	(2,951		)	—			(655,432		)

Income tax expense (benefit)	839			—			(880		)	—			—			(41		)
Equity in earnings (loss) of subsidiaries	(690,554		)	—			—			—			690,554			—

Net earnings (loss)	(655,391		)	(7		)	(687,596		)	(2,951		)	690,554			(655,391		)

Other comprehensive income (loss)	28,758			—			—			—			—			28,758

Comprehensive income (loss)	$	(626,633	)	$	(7	)	$	(687,596	)	$	(2,951	)	$	690,554		$	(626,633	)



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(in thousands)

	For the year ended July 31, 2018
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	139,294		$	(5	)	$	(48,708	)	$	3,573		$	11,000		$	105,154

Cash flows from investing activities:
Business acquisitions, net of cash acquired	(18,141		)	—			—			—			—			(18,141		)
Capital expenditures	(81,114		)	—			(3,805		)	—			—			(84,919		)
Proceeds from sale of assets, dispositions and other	7,327			—			145,260			—			—			152,587
Cash collected for purchase of interest in accounts receivable	—			—			—			1,226,211			(1,226,211		)	—
Cash remitted to Ferrellgas, L.P for accounts receivable	—			—			—			(1,215,211		)	1,215,211			—
Net changes in advances with consolidated entities	96,514			—			—			—			(96,514		)	—
Other	—			—			—			—			—			—
Net cash provided by (used in) investing activities	4,586			—			141,455			11,000			(107,514		)	49,527

Cash flows from financing activities:
Distributions	(70,962		)	—			—			—			—			(70,962		)
Proceeds from issuance of long-term debt	323,680			—			—			—			—			323,680
Payments on long-term debt	(212,920		)	—			—			—			—			(212,920		)
Net reductions in short-term borrowings	(51,379		)	—			—			—			—			(51,379		)
Net additions to collateralized short-term borrowings	—			—			—			(11,000		)	—			(11,000		)
Net changes in advances with parent	—			5			(92,946		)	(3,573		)	96,514			—
Cash paid for financing costs	(18,493		)	—			—			—			—			(18,493		)
Net cash provided by (used in) financing activities	(30,074		)	5			(92,946		)	(14,573		)	96,514			(41,074		)

Increase (decrease) in cash and cash equivalents	113,806			—			(199		)	—			—			113,607
Cash and cash equivalents - beginning of year	5,327			1			373			—			—			5,701
Cash and cash equivalents - end of year	$	119,133		$	1		$	174		$	—		$	—		$	119,308



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(in thousands)

	For the year ended July 31, 2017
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	185,640		$	(5	)	$	(36,297	)	$	4,410		$	(5,000	)	$	148,748

Cash flows from investing activities:
Business acquisitions, net of cash acquired	(3,539		)	—			—			—			—			(3,539		)
Capital expenditures	(49,107		)	—			(1,365		)	—			—			(50,472		)
Proceeds from sale of assets, dispositions and other	8,510			—			—			—			—			8,510
Cash collected for purchase of interest in accounts receivable	—			—			—			1,011,244			(1,011,244		)	—
Cash remitted to Ferrellgas, L.P for accounts receivable	—			—			—			(1,016,244		)	1,016,244			—
Net changes in advances with consolidated entities	(33,573		)	—			—			360			33,213			—
Other	(37		)	—			—			—			—			(37		)
Net cash used in investing activities	(77,746		)	—			(1,365		)	(4,640		)	38,213			(45,538		)

Cash flows from financing activities:
Distributions	(119,879		)	—			—			—			—			(119,879		)
Contributions	167,843			—			—			—			—			167,843
Proceeds from issuance of long-term debt	62,864			—			—			—			—			62,864
Payments on long-term debt	(174,292		)	—			—			—			—			(174,292		)
Net reductions to short-term borrowings	(41,510		)	—			—			—			—			(41,510		)
Net additions in collateralized short-term borrowings	—			—			—			5,000			—			5,000
Net changes in advances with parent	—			5			37,618			(4,410		)	(33,213		)	—
Cash paid for financing costs	(2,065		)	—			—			(360		)	—			(2,425		)
Net cash provided by (used in) financing activities	(107,039		)	5			37,618			230			(33,213		)	(102,399		)

Increase (decrease) in cash and cash equivalents	855			—			(44		)	—			—			811
Cash and cash equivalents - beginning of year	4,472			1			417			—			—			4,890
Cash and cash equivalents - end of year	$	5,327		$	1		$	373		$	—		$	—		$	5,701



FERRELLGAS, L.P. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(in thousands)

	For the year ended July 31, 2016
	Ferrellgas, L.P. (Parent and Co-Issuer)			Ferrellgas Finance Corp. (Co-Issuer)			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	102,569		$	(9	)	$	89,728		$	14,456		$	6,000		$	212,744

Cash flows from investing activities:
Business acquisitions, net of cash acquired	(15,144		)	—			—			—			—			(15,144		)
Capital expenditures	(52,501		)	—			(65,017		)	—			—			(117,518		)
Proceeds from sale of assets, dispositions and other	17,089			—			—			—			—			17,089
Cash collected for purchase of interest in accounts receivable	—			—			—			946,804			(946,804		)	—
Cash remitted to Ferrellgas, L.P for accounts receivable	—			—			—			(940,804		)	940,804			—
Net changes in advances with consolidated entities	38,759			—			—			—			(38,759		)	—
Other	(286		)	—			—			—			—			(286		)
Net cash provided by (used in) investing activities	(12,083		)	—			(65,017		)	6,000			(44,759		)	(115,859		)

Cash flows from financing activities:
Distributions	(269,541		)	—			—			—			—			(269,541		)
Contributions	30			—			—			—			—			30
Proceeds from issuance of long-term debt	168,117			—			—			—			—			168,117
Payments on long-term debt	(14,959		)	—			—			—			—			(14,959		)
Net additions to short-term borrowings	25,972			—			—			—			—			25,972
Net reductions in collateralized short-term borrowings	—			—			—			(6,000		)	—			(6,000		)
Net changes in advances with parent	—			9			(24,314		)	(14,454		)	38,759			—
Cash paid for financing costs	(1,214		)	—			—			—			—			(1,214		)
Net cash provided by (used in) financing activities	(91,595		)	9			(24,314		)	(20,454		)	38,759			(97,595		)

Effect of exchange rate changes on cash	2			—			—			(2		)	—			—

Increase (decrease) in cash and cash equivalents	(1,107		)	—			397			—			—			(710		)
Cash and cash equivalents - beginning of year	5,579			1			20			—			—			5,600
Cash and cash equivalents - end of year	$	4,472		$	1		$	417		$	—		$	—		$	4,890

The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document.

Guarantor financial information

Subsequent Events	12 Months Ended
Subsequent Events	Jul. 31, 2018
Subsequent Events	Ferrellgas has evaluated events and transactions occurring after the balance sheet date through the date Ferrellgas’ consolidated financial statements were issued and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.
Ferrellgas Partners Finance Corp. [Member]
Subsequent Events	Subsequent events The Finance Corp. has evaluated events and transactions occurring after the balance sheet date through the date the Finance Corp.’s consolidated financial statements were issued, and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.
Ferrellgas, L.P. [Member]
Subsequent Events	Ferrellgas, L.P. has evaluated events and transactions occurring after the balance sheet date through the date Ferrellgas, L.P.’s consolidated financial statements were issued and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.
Ferrellgas Finance Corp. [Member]
Subsequent Events	Subsequent events The Finance Corp. has evaluated events and transactions occurring after the balance sheet date through the date the Finance Corp.’s consolidated financial statements were issued, and concluded that there were no events or transactions occurring during this period that required recognition or disclosure in its financial statements.

Schedule I Parent Only Balance Sheets, Statements Of Earnings And Cash Flows

12 Months Ended

Jul. 31, 2018

Parent Company [Member]



				Schedule 1
FERRELLGAS PARTNERS, L.P.
PARENT ONLY
BALANCE SHEETS
(in thousands, except unit data)
	July 31,
	2018			2017
ASSETS

Cash and cash equivalents	$	3		$	59
Prepaid expenses and other current assets	23			4
Total assets	$	26		$	63

LIABILITIES AND PARTNERS' DEFICIT

Other current liabilities	$	3,925		$	4,250

Long-term debt	350,500			346,525
Investment in Ferrellgas, L.P.	673,386			402,866

Partners' deficit
Common unitholders (97,152,665 units outstanding at 2018 and 2017)	(978,503		)	(701,188		)
General partner unitholder (989,926 units outstanding at 2018 and 2017)	(69,792		)	(66,991		)
Accumulated other comprehensive income	20,510			14,601
Total Ferrellgas Partners, L.P. partners' deficit	(1,027,785		)	(753,578		)
Total liabilities and partners' deficit	$	26		$	63



FERRELLGAS PARTNERS, L.P.
PARENT ONLY
STATEMENTS OF OPERATIONS
(in thousands)
	For the year ended July 31,
	2018			2017			2016
Equity in loss of Ferrellgas, L.P.	$	(219,902	)	$	(28,765	)	$	(648,771	)
Operating, general and administrative expense	137			139			520

Operating loss	(220,039		)	(28,904		)	(649,291		)

Interest expense	(34,521		)	(25,297		)	(16,119		)
Income tax expense	21			6			5
Net loss	$	(254,581	)	$	(54,207	)	$	(665,415	)



FERRELLGAS PARTNERS, L.P.
PARENT ONLY
STATEMENTS OF CASH FLOWS
(in thousands)
	For the year ended July 31,
	2018			2017			2016
Cash flows from operating activities:
Net loss attributable to Ferrellgas Partners, L.P.	$	(254,581	)	$	(54,207	)	$	(665,415	)
Reconciliation of net loss to net cash used in operating activities:
Other	3,673			3,982			(1,743		)
Equity in loss of Ferrellgas, L.P.	219,902			28,765			648,771
Net cash used in operating activities	(31,006		)	(21,460		)	(18,387		)

Cash flows from investing activities:
Distributions received from Ferrellgas, L.P.	70,246			118,829			266,818
Cash contributed to Ferrellgas, L.P.	—			(166,148		)	—
Net cash provided by (used in) investing activities	70,246			(47,319		)	266,818

Cash flows from financing activities:
Distributions paid to common and general partner unitholders	(39,254		)	(79,733		)	(204,160		)
Cash paid for financing costs	(42		)	(3,653		)	—
Proceeds from issuance of long-term debt	—			168,000			—
Repurchase of common units (including fees of $34 for the year ended July 31, 2016)	—			(15,851		)	(46,432		)
Proceeds from exercise of common unit options	—			—			182
Cash contribution from general partners in connection with common unit issuances	—			—			2
Net cash provided by (used in) financing activities	(39,296		)	68,763			(250,408		)

Decrease in cash and cash equivalents	(56		)	(16		)	(1,977		)
Cash and cash equivalents - beginning of year	59			75			2,052
Cash and cash equivalents - end of year	$	3		$	59		$	75

Schedule II Valuation And Qualifying Accounts

Schedule II Valuation And Qualifying Accounts

12 Months Ended

Jul. 31, 2018



									Schedule II
FERRELLGAS PARTNERS, L.P. AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
(in thousands)
	Balance at		Charged to						Balance
	beginning		cost and						at end
Description	of period		expenses		Other				of period
Year ended July 31, 2018

Allowance for doubtful accounts	$	1,976	$	1,778	$	(1,299	)	(1)	$	2,455

Year ended July 31, 2017

Allowance for doubtful accounts	$	5,526	$	7	$	(3,557	)	(1)	$	1,976

Year ended July 31, 2016

Allowance for doubtful accounts	$	4,816	$	1,703	$	(993	)	(1)	$	5,526


(1)	Uncollectible accounts written off, net of recoveries.

Schedule II Valuation And Qualifying Accounts



									Schedule II
FERRELLGAS, L.P. AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
(in thousands)
	Balance at		Charged to						Balance
	beginning		cost and						at end
Description	of period		expenses		Other				of period
Year ended July 31, 2018

Allowance for doubtful accounts	$	1,976	$	1,778	$	(1,299	)	(1)	$	2,455

Year ended July 31, 2017

Allowance for doubtful accounts	$	5,526	$	7	$	(3,557	)	(1)	$	1,976

Year ended July 31, 2016

Allowance for doubtful accounts	$	4,816	$	1,703	$	(993	)	(1)	$	5,526


(1)	Uncollectible accounts written off, net of recoveries.

Summary Of Significant Accounting Policies (Policy)

12 Months Ended

Jul. 31, 2018

Principles of consolidation

Accounting estimates

Accounting estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from these estimates. Significant estimates impacting the consolidated financial statements include accruals that have been established for contingent liabilities, pending claims and legal actions arising in the normal course of business, useful lives of property, plant and equipment, residual values of tanks, capitalization of customer tank installation costs, amortization methods of intangible assets, valuation methods used to value sales returns and allowances, allowance for doubtful accounts, fair value of reporting units, recoverability of long-lived assets, assumptions used to value business combinations, fair values of derivative contracts and stock-based compensation calculations.

Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas Partners, its wholly-owned subsidiary, Ferrellgas Partners Finance Corp., and the operating partnership, its majority-owned subsidiary, after elimination of all intercompany accounts and transactions. The accounts of Ferrellgas Partners’ majority-owned subsidiary are included based on the determination that the operating partnership is a variable interest entity for whom Ferrellgas Partners has no ability through voting rights or similar rights to make decisions and thus does not have the power to direct the activities of the operating partnership that most significantly impact economic performance. However, we have determined that Ferrellgas Partners is most closely associated with the operations of the operating partnership because Ferrellgas Partners has the obligation to absorb the losses of and the right to receive benefits from the operating partnership that are significant to the operating partnership and substantially all the assets and liabilities of Ferrellgas Partners consist of the operating partnership. The operating partnership includes the accounts of its wholly-owned subsidiaries. The general partner’s approximate 1% general partner interest in the operating partnership is accounted for as a noncontrolling interest. The wholly-owned consolidated subsidiary of the operating partnership, Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), is a special purpose entity that has agreements with the operating partnership to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Fair value measurements

Fair value measurements: Ferrellgas measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.


•	Level 1: Quoted prices in active markets for identical assets or liabilities.


•	Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.


•	Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Accounts receivable securitization

Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Inventories

Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

Property, plant and equipment

Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

Goodwill

Goodwill: Ferrellgas records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2018, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit's recorded amount of goodwill. Ferrellgas completed its most recent annual goodwill impairment test on January 31, 2018 and recorded an impairment charge of $10.0 million related to a decline in future expected cash flows of an immaterial reporting unit of our Propane operations and related equipment sales segment.

Intangible assets

Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the asset group.

Derivative instruments and hedging activities

Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Interest Rate Risk.

Revenue recognition

Revenue recognition: Revenues from Ferrellgas' propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Shipping and handling expenses

Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas are classified within “Equipment lease expense.”

See Note F – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

Cost of product sold

Cost of sales: “Cost of sales – propane and other gas liquids sales” includes all costs to acquire propane and other gas liquids, the costs of storing and transporting inventory prior to delivery to Ferrellgas’ customers, the results from risk management activities to hedge related price risk and the costs of materials related to the refurbishment of Ferrellgas’ portable propane tanks. "Cost of sales - midstream operations" included all costs incurred to purchase and transport crude oil, including the costs of terminaling and transporting crude oil prior to delivery to customers and the costs of salt water disposal. “Cost of sales – other” primarily includes costs related to the sale of propane appliances and equipment.

Operating expenses

Operating expense: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

General and administrative expenses

General and administrative expenses: “General and administrative expense” primarily includes personnel and incentive expense related to executives and employees, as well as other overhead expenses related to centralized corporate functions.

Stock-based and unit option plans

Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

Income taxes

Income taxes: Ferrellgas Partners is a publicly-traded master limited partnership with one subsidiary that is a taxable corporation. The operating partnership is a limited partnership with three subsidiaries that are taxable corporations. Partnerships are generally not subject to federal income tax, although publicly-traded partnerships are treated as corporations for federal income tax purposes and therefore subject to Federal income tax unless a qualifying income test is satisfied. If this qualifying income test is satisfied, the publicly-traded partnership will be treated as a partnership for Federal income tax purposes. Based on Ferrellgas’ calculations, Ferrellgas Partners satisfies the qualifying income test. As a result, except for the taxable corporations, Ferrellgas Partners’ earnings or losses for Federal income tax purposes are included in the tax returns of the individual partners, Ferrellgas Partners’ unitholders. Accordingly, the accompanying consolidated financial statements of Ferrellgas Partners reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to Ferrellgas Partners unitholders as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas Partners’ partnership agreement and differences between Ferrellgas Partners' financial reporting year end and its calendar tax year end.

Income tax benefit consisted of the following:



	For the year ended July 31,
	2018			2017			2016
Current expense (benefit)	$	1,140		$	(1,154	)	$	468
Deferred expense (benefit)	(3,818		)	11			(504		)
Income tax benefit	$	(2,678	)	$	(1,143	)	$	(36	)

Deferred taxes consisted of the following:



	July 31,
	2018			2017
Deferred tax assets (included in Other assets, net in 2018 and Prepaid expenses and other current assets in 2017)	$	715		$	1,068
Deferred tax liabilities (included in Other liabilities)	(16		)	(4,186		)
Net deferred tax asset (liability)	$	699		$	(3,118	)

Sales taxes

Sales taxes: Ferrellgas accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

Net earnings (loss) per common unitholders' interest

Net loss per common unitholders’ interest: Net loss per common unitholders’ interest is computed by dividing “Net loss attributable to Ferrellgas Partners, L.P.,” after deducting the general partner's 1% interest, by the weighted average number of outstanding common units and the dilutive effect, if any, of outstanding unit options. See Note P – Net loss per common unitholders’ interest – for further discussion about these calculations.

Loss Contingencies

Loss contingencies: In the normal course of business, Ferrellgas is involved in various claims and legal proceedings. Ferrellgas records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

New accounting standards

New accounting standards:

FASB Accounting Standard Update No. 2014-09

FASB Accounting Standard Update No. 2016-02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability

FASB Accounting Standard Update No. 2016-13

FASB Accounting Standard Update No. 2017-12

Principles of consolidation

Accounting estimates

Principles of consolidation: The accompanying consolidated financial statements present the consolidated financial position, results of operations and cash flows of Ferrellgas, L.P. and its subsidiaries after elimination of all intercompany accounts and transactions. Ferrellgas, L.P. consolidates the following wholly-owned entities: Bridger Logistics, LLC, Sable Environmental, LLC, Sable SWD 2, LLC, Blue Rhino Global Sourcing, Inc., Blue Rhino Canada, Inc., Ferrellgas Real Estate, Inc., Ferrellgas Finance Corp. and Ferrellgas Receivables, LLC (“Ferrellgas Receivables”), a special purpose entity that has agreements with Ferrellgas, L.P. to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Fair value measurements

Fair value measurements: Ferrellgas, L.P. measures certain of its assets and liabilities at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants – in either the principal market or the most advantageous market. The principal market is the market with the greatest level of activity and volume for the asset or liability.


•	Level 1: Quoted prices in active markets for identical assets or liabilities.


•	Level 2: Quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.


•	Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable.

Accounts receivable securitization

Accounts receivable securitization: Through its wholly-owned and consolidated subsidiary Ferrellgas Receivables, Ferrellgas, L.P. has agreements to securitize, on an ongoing basis, a portion of its trade accounts receivable.

Inventories

Inventories: Inventories are stated at the lower of cost or net realizable value using weighted average cost and actual cost methods.

Property, plant and equipment

Property, plant and equipment: Property, plant and equipment are stated at cost less accumulated depreciation. Expenditures for maintenance and routine repairs are expensed as incurred. Ferrellgas, L.P. capitalizes computer software, equipment replacement and betterment expenditures that upgrade, replace or completely rebuild major mechanical components and extend the original useful life of the equipment. Depreciation is calculated using the straight-line method based on the estimated useful lives of the assets ranging from two to 30 years. Ferrellgas, L.P., using its best estimates based on reasonable and supportable assumptions and projections, tests long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of its assets or asset groups might not be recoverable. The recoverability tests for property, plant and equipment are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas, L.P. management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the assets.

Goodwill

Goodwill: Ferrellgas, L.P. records goodwill as the excess of the cost of acquisitions over the fair value of the related net assets at the date of acquisition. Ferrellgas, L.P. tests goodwill for impairment annually during the second quarter or more frequently if events or changes in circumstances indicate that it is more likely than not the fair value of a reporting unit is less than the carrying value. Ferrellgas, L.P. has determined that it has two reporting units for goodwill impairment testing purposes. As of July 31, 2018, one of these reporting units contains goodwill that is subject to at least an annual assessment for impairment by applying a fair-value-based test. Under this test, the carrying value of each reporting unit is determined by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of the evaluation on a specific identification basis. To the extent a reporting unit’s carrying value exceeds its fair value, the reporting unit’s goodwill is impaired. The amount of impairment would be equal to the lesser of the excess of reporting unit carrying value over its fair value and the reporting unit's recorded amount of goodwill. Ferrellgas, L.P. completed its most recent annual goodwill impairment test on January 31, 2018

Intangible assets

Intangible assets: Intangible assets with finite useful lives, consisting primarily of customer related assets and non-compete agreements, permits, favorable lease arrangements and patented technology are stated at cost, net of accumulated amortization calculated using the straight-line method over periods ranging from two to 15 years. When necessary, intangible assets’ useful lives are revised and the impact on amortization reflected on a prospective basis. Trade names and trademarks have indefinite lives, are not amortized, and are stated at cost. Ferrellgas, L.P. tests finite-lived intangible assets for impairment when events or changes in circumstances indicate that the carrying amount of these assets or asset groups might not be recoverable. Ferrellgas, L.P. tests indefinite-lived intangible assets for impairment annually on January 31 or more frequently if circumstances dictate. The recoverability tests for definite-lived intangible assets are performed at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The recoverability test is performed by determining the carrying value of the asset group and comparing it to the estimated expected undiscounted future cash flows of the asset group. The expected future cash flows are estimated based on Ferrellgas, L.P. management's plans. If the carrying value exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the difference between the estimated fair market value and the carrying value of the assets.

Derivative instruments and hedging activities

Derivative instruments and hedging activities:

Commodity and Transportation Fuel Price Risk.

Interest Rate Risk.

Revenue recognition

Revenue recognition: Revenues from Ferrellgas, L.P.'s propane operations and related equipment sales segment are recognized at the time product is delivered with payments generally due 30 days after receipt. Amounts are considered past due after 30 days. Ferrellgas, L.P. determines accounts receivable allowances based on management’s assessment of the creditworthiness of the customers and other collection actions. Ferrellgas, L.P. offers “even pay” billing programs that can create customer deposits or advances. Revenue is recognized from these customer deposits or advances to customers at the time product is delivered. Other revenues, which include revenue from the sale of propane appliances and equipment is recognized at the time of delivery or installation. Ferrellgas, L.P. recognizes shipping and handling revenues and expenses for sales of propane, appliances and equipment at the time of delivery or installation. Shipping and handling revenues are included in the price of propane charged to customers, and are classified as revenue. Revenues from annually billed, non-refundable propane tank rentals are recognized in “Revenues: other” on a straight-line basis over one year.

Shipping and handling expenses

Shipping and handling expenses: Shipping and handling expenses related to delivery personnel, vehicle repair and maintenance and general liability expenses are classified within “Operating expense” in the consolidated statements of operations. Depreciation expenses on delivery vehicles Ferrellgas, L.P. owns are classified within “Depreciation and amortization expense.” Delivery vehicles and distribution technology leased by Ferrellgas, L.P. are classified within “Equipment lease expense.”

See Note F – Supplemental financial statement information – for the financial statement presentation of shipping and handling expenses.

Cost of product sold

Cost of sales: “Cost of sales – propane and other gas liquids sales” includes all costs to acquire propane and other gas liquids, the costs of storing and transporting inventory prior to delivery to Ferrellgas, L.P.’s customers, the results from risk management activities to hedge related price risk and the costs of materials related to the refurbishment of Ferrellgas, L.P.’s portable propane tanks. "Cost of sales - midstream operations" includes all costs incurred to purchase and transport crude oil, including the costs of terminaling and transporting crude oil prior to delivery to customers and the costs of salt water disposal. “Cost of sales – other” primarily includes costs related to the sale of propane appliances and equipment.

Operating expenses

Operating expenses: “Operating expense” primarily includes the personnel, vehicle, delivery, handling, plant, office, selling, marketing, credit and collections and other expenses.

General and administrative expenses

Stock-based and unit option plans

Stock-based plans:

Ferrell Companies, Inc. Incentive Compensation Plans (“ICPs”)

Income taxes

Income taxes: Ferrellgas, L.P. is a limited partnership and owns three subsidiaries that are taxable corporations. As a result, except for the taxable corporations, Ferrellgas, L.P.’s earnings or losses for federal income tax purposes are included in the tax returns of the individual partners. Accordingly, the accompanying consolidated financial statements of Ferrellgas, L.P. reflect federal income taxes related to the above mentioned taxable corporations and certain states that allow for income taxation of partnerships. Net earnings for financial statement purposes may differ significantly from taxable income reportable to partners as a result of differences between the tax basis and financial reporting basis of assets and liabilities, the taxable income allocation requirements under Ferrellgas, L.P.’s partnership agreement and differences between Ferrellgas, L.P.’s financial reporting year end and limited partners tax year end.

Income tax benefit consisted of the following:



	For the year ended July 31,
	2018			2017			2016
Current expense (benefit)	$	1,119		$	(1,160	)	$	463
Deferred expense (benefit)	(3,818		)	11			(504		)
Income tax benefit	$	(2,699	)	$	(1,149	)	$	(41	)

Deferred taxes consisted of the following:



	July 31,
	2018			2017
Deferred tax assets (included in Other assets, net in 2018 and Prepaid expenses and other current assets in 2017)	$	715		$	1,068
Deferred tax liabilities (included in Other liabilities)	(16		)	(4,186		)
Net deferred tax asset (liability)	$	699		$	(3,118	)

Sales taxes

Sales taxes: Ferrellgas, L.P. accounts for the collection and remittance of sales tax on a net tax basis. As a result, these amounts are not reflected in the consolidated statements of operations.

Loss Contingencies

Loss contingencies: In the normal course of business, Ferrellgas, L.P. is involved in various claims and legal proceedings. Ferrellgas, L.P. records a liability for such matters when it is probable that a loss has been incurred and the amounts can be reasonably estimated. When only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range is a better estimate than any other amount within the range, the minimum amount in the range is accrued. Legal costs associated with loss contingencies are expensed as incurred.

New accounting standards

New accounting standards:

FASB Accounting Standard Update No. 2014-09

In May 2014, the Financial Accounting Standards Board, ("FASB") issued Accounting Standard Update ("ASU") 2014-09, Revenue from Contracts with Customers. The issuance is part of a joint effort by the FASB and the International Accounting Standards Board ("IASB") to enhance financial reporting by creating common revenue recognition guidance for U.S. GAAP and International Financial Reporting Standards ("IFRS") and, thereby, improving the consistency of requirements, comparability of practices and usefulness of disclosures. The new standard will supersede much of the existing authoritative literature for revenue recognition. The standard and related amendments will be effective for Ferrellgas, L.P. for its annual reporting period beginning August 1, 2018, including interim periods within that reporting period. Entities are allowed to transition to the new standard by either recasting prior periods or recognizing the cumulative effect. Ferrellgas, L.P. has completed its assessment of its contracts with customers and impacts to revenue recognition under the new guidance. When Ferrellgas, L.P. adopts the new guidance, which will be August 1, 2018, the impact will not be material to its consolidated financial statements. Ferrellgas, L.P. will utilize the modified retrospective transition method, which recognizes the cumulative effect upon adoption, when it adopts the new standard.

FASB Accounting Standard Update No. 2016-02

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability

FASB Accounting Standard Update No. 2016-13

FASB Accounting Standard Update No. 2017-12

In August 2017, the FASB issued ASU 2017-12, Financial Instruments - Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities, which is intended to improve the financial reporting for hedging relationships to better portray the economic results of an entity's risk management activities in its financial statements. This standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Ferrellgas is currently evaluating the impact of its pending adoption of this standard on the consolidated financial statements.

Summary Of Significant Accounting Policies (Tables)

12 Months Ended

Jul. 31, 2018

Summary Of Income Tax Expense

Income tax benefit consisted of the following:



	For the year ended July 31,
	2018			2017			2016
Current expense (benefit)	$	1,140		$	(1,154	)	$	468
Deferred expense (benefit)	(3,818		)	11			(504		)
Income tax benefit	$	(2,678	)	$	(1,143	)	$	(36	)

Deferred Tax Assets And Liabilities

Deferred taxes consisted of the following:



	July 31,
	2018			2017
Deferred tax assets (included in Other assets, net in 2018 and Prepaid expenses and other current assets in 2017)	$	715		$	1,068
Deferred tax liabilities (included in Other liabilities)	(16		)	(4,186		)
Net deferred tax asset (liability)	$	699		$	(3,118	)

Summary Of Income Tax Expense

Income tax benefit consisted of the following:



	For the year ended July 31,
	2018			2017			2016
Current expense (benefit)	$	1,119		$	(1,160	)	$	463
Deferred expense (benefit)	(3,818		)	11			(504		)
Income tax benefit	$	(2,699	)	$	(1,149	)	$	(41	)

Deferred Tax Assets And Liabilities

Deferred taxes consisted of the following:



	July 31,
	2018			2017
Deferred tax assets (included in Other assets, net in 2018 and Prepaid expenses and other current assets in 2017)	$	715		$	1,068
Deferred tax liabilities (included in Other liabilities)	(16		)	(4,186		)
Net deferred tax asset (liability)	$	699		$	(3,118	)

Acquisitions, dispositions and other significant transactions(Tables)

12 Months Ended

Jul. 31, 2018

Disposal Groups, Including Discontinued Operations [Table Text Block]

"Loss on asset sales and disposals" consists of:



	For the year ended July 31,
	2018		2017		2016
Loss on sale of:
Propane-related accessories reporting unit	$	15,194	$	—	$	—
Midstream trucking, water disposal & terminal assets	120,240		—		—
Midstream railcars	36,762		—		—
Bridger Energy	4,002		—		—
Midstream trucks	—		—		13,810
Other	11,201		14,457		17,025
Loss on asset sales and disposals	$	187,399	$	14,457	$	30,835

Disposal Groups, Including Discontinued Operations [Table Text Block]

"Loss on asset sales and disposals" consists of:



	For the year ended July 31,
	2018		2017		2016
Loss on sale of:
Propane-related accessories reporting unit	$	15,194	$	—	$	—
Midstream trucking, water disposal & terminal assets	120,240		—		—
Midstream railcars	36,762		—		—
Bridger Energy	4,002		—		—
Midstream trucks	—		—		13,810
Other	11,201		14,457		17,025
Loss on asset sales and disposals	$	187,399	$	14,457	$	30,835

Schedule Of Funding Of Acquisitions

These acquisitions were funded as follows on their dates of acquisition:



	For the year ended July 31,
	2018		2017		2016
Cash payments, net of cash acquired	$	18,141	$	3,539	$	4,476
Issuance of liabilities and other costs and considerations	2,426		856		2,126
Aggregate fair value of transactions	$	20,567	$	4,395	$	6,602

Schedule Of Funding Of Acquisitions



	For the year ended July 31,
	2018		2017		2016
Working capital	$	758	$	139	$	(249	)
Customer tanks, buildings, land and other	10,022		1,220		3,625
Customer lists	7,758		2,648		2,962
Non-compete agreements	2,029		388		264
Aggregate fair value of net assets acquired	$	20,567	$	4,395	$	6,602

These acquisitions were funded as follows on their dates of acquisition:



	For the year ended July 31,
	2018		2017		2016
Cash payments, net of cash acquired	$	18,141	$	3,539	$	4,476
Issuance of liabilities and other costs and considerations	2,426		856		2,126
Aggregate fair value of transactions	$	20,567	$	4,395	$	6,602

Midstream Operations [Member]



	For the year ended July 31,
	2018		2017		2016
Working capital	758		139		(249		)
Customer tanks, buildings, land and other	10,022		1,220		3,625
Customer lists	7,758		2,648		2,962
Non-compete agreements	2,029		388		264
Aggregate fair value of net assets acquired	$	20,567	$	4,395	$	6,602

Midstream Operations [Member] | Ferrellgas, L.P. [Member]

The following table summarizes the final estimated fair values of the assets acquired and liabilities assumed in connection with the Bridger acquisition completed in fiscal 2015:



	June 24, 2016
Working capital	$	(8,315	)
Transportation equipment	293,491
Injection stations and pipelines	41,632
Goodwill	189,196
Customer relationships	277,224
Non-compete agreements	10,000
Trade names & trademarks	9,400
Office equipment	7,449
Other	2,375
Aggregate fair value of net assets acquired	$	822,452

The following table summarizes the final estimated fair values of the assets acquired and liabilities assumed in connection with the Bridger acquisition completed in fiscal 2015:



	June 24, 2016
Working capital	$	(8,315	)
Transportation equipment	293,491
Injection stations and pipelines	41,632
Goodwill	189,196
Customer relationships	277,224
Non-compete agreements	10,000
Trade names & trademarks	9,400
Office equipment	7,449
Other	2,375
Aggregate fair value of net assets acquired	$	822,452

Other Assets Disclosure [Text Block]

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Supplemental Financial Statement Information (Tables)

12 Months Ended

Jul. 31, 2018

Other assets, net consist of the following:



	2018		2017
Notes receivable, less current portion	$	27,491	$	32,500
Other	47,097		41,557
Other assets, net	$	74,588	$	74,057

Schedule Of Inventories

Inventories consist of the following:



	2018		2017
Propane gas and related products	$	71,180	$	67,049
Appliances, parts and supplies, and other	12,514		25,503
Inventories	$	83,694	$	92,552

Property, Plant And Equipment

Property, plant and equipment, net consist of the following:



	Estimated useful lives	2018		2017
Land	Indefinite	$	33,719	$	35,824
Land improvements	2-20	13,361		14,342
Buildings and improvements	20	71,612		73,333
Vehicles, including transport trailers	8-20	85,893		121,233
Bulk equipment and district facilities	5-30	103,627		104,291
Tanks, cylinders and customer equipment	2-30	769,165		755,867
Salt water disposal wells and related equipment	2-30	—		52,495
Rail cars	30	—		91,787
Injection stations	20	—		13,130
Pipeline	15	—		1,663
Computer and office equipment	2-5	109,346		118,518
Construction in progress	n/a	14,394		10,974
		1,201,117		1,393,457
Less: accumulated depreciation		643,394		661,534
Property, plant and equipment, net		$	557,723	$	731,923

Other Current Liabilities

Other current liabilities consist of the following:



	2018		2017
Accrued interest	$	22,222	$	18,671
Customer deposits and advances	22,829		25,541
Accrued payroll	16,060		19,704
Accrued insurance	15,100		13,615
Other	65,814		48,693
Other current liabilities	$	142,025	$	126,224

Shipping And Handling Expenses

Shipping and handling expenses are classified in the following consolidated statements of operations line items:



	For the year ended July 31,
	2018		2017		2016
Operating expense	$	195,646	$	175,164	$	167,980
Depreciation and amortization expense	4,947		3,909		4,282
Equipment lease expense	25,765		26,299		25,967
	$	226,358	$	205,372	$	198,229

Schedule of Cash Flow, Supplemental Disclosures [Table Text Block]

Certain cash flow and significant non-cash activities are presented below:



	For the year ended July 31,
	2018			2017		2016
CASH PAID (REFUNDED) FOR:
Interest	$	159,271		$	143,441	$	133,629
Income taxes	$	(291	)	$	310	$	777
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Liabilities incurred in connection with acquisitions	$	1,993		$	139	$	2,126
Change in accruals for property, plant and equipment additions	$	264		$	164	$	(1,122	)

Other Assets Disclosure [Text Block]

Other assets, net consist of the following:



	2018		2017
Notes receivable, less current portion	$	27,491	$	32,500
Other	47,097		41,557
Other assets, net	$	74,588	$	74,057

Schedule Of Inventories

Inventories consist of the following:



	2018		2017
Propane gas and related products	$	71,180	$	67,049
Appliances, parts and supplies, and other	12,514		25,503
Inventories	$	83,694	$	92,552

Property, Plant And Equipment

Property, plant and equipment, net consist of the following:



	Estimated useful lives	2018		2017
Land	Indefinite	$	33,719	$	35,824
Land improvements	2-20	13,361		14,342
Buildings and improvements	20	71,612		73,333
Vehicles, including transport trailers	8-20	85,893		121,233
Bulk equipment and district facilities	5-30	103,627		104,291
Tanks, cylinders and customer equipment	2-30	769,165		755,867
Salt water disposal wells and related equipment	2-30	—		52,495
Rail cars	30	—		91,787
Injection stations	20	—		13,130
Pipeline	15	—		1,663
Computer and office equipment	2-5	109,346		118,518
Construction in progress	n/a	14,394		10,974
		1,201,117		1,393,457
Less: accumulated depreciation		643,394		661,534
Property, plant and equipment, net		$	557,723	$	731,923

Other Current Liabilities

Other current liabilities consist of the following:



	2018		2017
Customer deposits and advances	$	22,829	$	25,541
Accrued interest	18,288		14,737
Accrued payroll	16,060		19,704
Accrued insurance	15,100		13,615
Other	65,814		48,419
Other current liabilities	$	138,091	$	122,016

Shipping And Handling Expenses

Shipping and handling expenses are classified in the following consolidated statements of operations line items:



	For the year ended July 31,
	2018		2017		2016
Operating expense	$	195,646	$	175,164	$	167,980
Depreciation and amortization expense	4,947		3,909		4,282
Equipment lease expense	25,765		26,299		25,967
	$	226,358	$	205,372	$	198,229

Schedule of Cash Flow, Supplemental Disclosures [Table Text Block]

Certain cash flow and significant non-cash activities are presented below:



	For the year ended July 31,
	2018			2017		2016
CASH PAID (REFUNDED) FOR:
Interest	$	128,479		$	122,084	$	117,931
Income taxes	$	(311	)	$	305	$	773
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Liabilities incurred in connection with acquisitions	$	1,993		$	139	$	2,126
Change in accruals for property, plant and equipment additions	$	264		$	164	$	(1,122	)

Goodwill And Intangible Assets, Net (Tables)

12 Months Ended

Jul. 31, 2018

Schedule of Goodwill Rollforward

Goodwill and intangible assets, net consist of the following:



	July 31, 2018							July 31, 2017
	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Goodwill, net	$	246,098	$	—		$	246,098	$	256,103	$	—		$	256,103

Intangible assets, net
Amortized intangible assets
Customer related	$	441,393	$	(376,605	)	$	64,788	$	556,678	$	(397,891	)	$	158,787
Non-compete agreements	24,653		(19,511		)	5,142		39,875		(27,887		)	11,988
Permits and favorable lease arrangements	—		—			—		17,225		(3,506		)	13,719
Other	3,513		(3,513		)	—		9,301		(7,144		)	2,157
	469,559		(399,629		)	69,930		623,079		(436,428		)	186,651

Unamortized intangible assets
Trade names & trademarks	51,021		—			51,021		64,451		—			64,451
Total intangible assets, net	$	520,580	$	(399,629	)	$	120,951	$	687,530	$	(436,428	)	$	251,102

Changes in the carrying amount of goodwill are as follows:



	Propane operations and related equipment sales
Balance July 31, 2016	$	256,103
Acquisitions	—
Balance July 31, 2017	256,103
Impairment	(10,005		)
Balance July 31, 2018	$	246,098

Schedule Of Aggregate Amortization Expense



Aggregate amortization expense related to intangible assets, net:
For the year ended July 31,
2018	$	31,345
2017	32,148
2016	61,970

Schedule Of Estimated Amortization Expense



Estimated amortization expense:
For the year ended July 31,
2019	$	14,388
2020	8,877
2021	8,182
2022	6,810
2023	6,492

Schedule of Goodwill Rollforward

Goodwill and intangible assets, net consist of the following:



	July 31, 2018							July 31, 2017
	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Goodwill, net	$	246,098	$	—		$	246,098	$	256,103	$	—		$	256,103

Intangible assets, net
Amortized intangible assets
Customer related	$	441,393	$	(376,605	)	$	64,788	$	556,678	$	(397,891	)	$	158,787
Non-compete agreements	24,653		(19,511		)	5,142		39,875		(27,887		)	11,988
Permits and favorable lease arrangements	—		—			—		17,225		(3,506		)	13,719
Other	3,513		(3,513		)	—		9,301		(7,144		)	2,157
	469,559		(399,629		)	69,930		623,079		(436,428		)	186,651

Unamortized intangible assets
Trade names & trademarks	51,021		—			51,021		64,451		—			64,451
Total intangible assets, net	$	520,580	$	(399,629	)	$	120,951	$	687,530	$	(436,428	)	$	251,102

Changes in the carrying amount of goodwill are as follows:



	Propane operations and related equipment sales
Balance July 31, 2016	$	256,103
Acquisitions	—
Balance July 31, 2017	256,103
Impairment	(10,005		)
Balance July 31, 2018	$	246,098

Schedule Of Aggregate Amortization Expense



Aggregate amortization expense related to intangible assets, net:
For the year ended July 31,
2018	$	31,345
2017	32,148
2016	61,970

Schedule Of Estimated Amortization Expense



Estimated amortization expense:
For the year ended July 31,
2019	$	14,388
2020	8,877
2021	8,182
2022	6,810
2023	6,492

Debt Schedule of LT Debt (Tables)

12 Months Ended

Jul. 31, 2018

Debt Instrument [Line Items]

Schedule of Debt [Table Text Block]

Long-term debt consists of the following:



	2018			2017
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000		$	500,000
Fixed rate, 6.75%, due 2023 (4)	500,000			500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $2,375 and $3,166 at 2018 and 2017, respectively (3)	477,375			478,166
Fixed rate, 8.625%, due 2020, net of unamortized discount of $3,766 and $5,976 at 2018 and 2017, respectively (2)	353,234			351,024
Fair value adjustments related to interest rate swaps	—			471

Secured credit facilities
Variable interest rate, Term Loan, matures May 2023	275,000			—
Variable interest rate, Revolving Facility (net of $59.8 million classified as short-term borrowings at July 31, 2017)	—			185,719

Notes payable
11.2% and 12.0% weighted average interest rate at July 31, 2018 and 2017, respectively, due 2019 to 2025, net of unamortized discount of $977 and $1,128 at July 31, 2018 and 2017, respectively	6,221			5,958
Total debt, excluding unamortized debt issuance and other costs	2,111,830			2,021,338
Unamortized debt issuance and other costs	(30,791		)	(22,965		)
Less: current portion, included in other current liabilities on the consolidated balance sheets	2,402			2,578
Long-term debt	$	2,078,637		$	1,995,795

(1)

(2)


(3)	During fiscal 2014, Ferrellgas issued $475.0 million in aggregate principal amount of 6.75% senior notes due 2022. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on January 15 and July 15 of each year. Ferrellgas would incur prepayment penalties if it were to repay the notes prior to November 2019.


(4)	During June 2015, Ferrellgas issued $500.0 million in aggregate principal amount of 6.75% senior notes due 2023. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year. Ferrellgas would incur prepayment penalties if it were to repay the notes prior to June 2021.

Schedule of Debt [Table Text Block]

Debt Instrument [Line Items]

Long-term debt consists of the following:



	2018			2017
Senior notes
Fixed rate, 6.50%, due 2021 (1)	$	500,000		$	500,000
Fixed rate, 6.75%, due 2023 (3)	500,000			500,000
Fixed rate, 6.75%, due 2022, net of unamortized premium of $2,375 and $3,166 at 2018 and 2017, respectively (2)	477,375			478,166
Fair value adjustments related to interest rate swaps	—			471

Secured credit facilities
Variable interest rate, Term Loan, expires May 2023	275,000			—
Variable interest rate, Revolving Facility (net of $59.8 million classified as short-term borrowings at July 31, 2017)	—			185,719

Notes payable
11.2% and 12.0% weighted average interest rate at July 31, 2018 and 2017, respectively, due 2019 to 2025, net of unamortized discount of $977 and $1,128 at July 31, 2018 and 2017, respectively	6,221			5,958
Total debt, excluding unamortized debt issuance and other costs	1,758,596			1,670,314
Unamortized debt issuance and other costs	(28,057		)	(18,466		)
Less: current portion, included in other current liabilities on the consolidated balance sheets	2,402			2,578
Long-term debt	$	1,728,137		$	1,649,270

(1)


(2)	During fiscal 2014, Ferrellgas, L.P. issued $475.0 million in aggregate principal amount of 6.75% senior notes due 2022. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on January 15 and July 15 of each year. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to November 2019.


(3)	During June 2015, Ferrellgas, L.P. issued $500.0 million in aggregate principal amount of 6.75% senior notes due 2023. The senior notes bear interest from the date of issuance, payable semi-annually in arrears on June 15 and December 15 of each year. Ferrellgas, L.P. would incur prepayment penalties if it were to repay the notes prior to June 2021.

Partners' Capital (Tables)

12 Months Ended

Jul. 31, 2018

Limited Partner Units

As of July 31, 2018 and 2017, limited partner units were beneficially owned by the following:



	2018	2017
Public common unitholders (1)	69,612,939	69,612,939
Ferrell Companies (2)	22,529,361	22,529,361
FCI Trading Corp. (3)	195,686	195,686
Ferrell Propane, Inc. (4)	51,204	51,204
James E. Ferrell (5)	4,763,475	4,763,475

Ferrellgas Paid Cash Distributions

Partnership distributions paid by Ferrellgas Partners



	For the year ended July 31,
	2018		2017		2016
Public common unitholders	$	27,846	$	56,561	$	145,666
Ferrell Companies	9,012		18,305		46,184
FCI Trading Corp.	80		160		400
Ferrell Propane, Inc.	20		41		104
James E. Ferrell	1,904		3,869		9,764
General partner	392		797		2,042
	$	39,254	$	79,733	$	204,160

Dividends Expected To Be Paid To Related Parties

Included in this cash distribution were the following amounts paid to related parties:



Ferrell Companies	$	2,253
FCI Trading Corp.	20
Ferrell Propane, Inc.	5
James E. Ferrell	476
General partner	98

Ferrellgas Paid Cash Distributions

Ferrellgas, L.P. has paid the following quarterly distributions.



	For the year ended July 31,
	2018		2017		2016
Ferrellgas Partners	$	70,246	$	102,978	$	220,058
General partner	716		1,050		2,246

Fair Value Measurement (Tables)

12 Months Ended

Jul. 31, 2018

Assets and Liabilities Fair Value Heirarchy



	Asset (Liability)
	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)		Total
July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470		$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910	)	$	—	$	(1,910	)

July 31, 2017:
Assets:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	583		$	—	$	583
Commodity derivatives	$	—	$	16,212		$	—	$	16,212
Liabilities:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	(707	)	$	—	$	(707	)
Commodity derivatives	$	—	$	(1,258	)	$	—	$	(1,258	)

Assets and Liabilities Fair Value Heirarchy



	Asset (Liability)
	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)			Unobservable Inputs (Level 3)		Total
July 31, 2018:
Assets:
Derivative financial instruments:
Commodity derivatives	$	—	$	22,470		$	—	$	22,470
Liabilities:
Derivative financial instruments:
Commodity derivatives	$	—	$	(1,910	)	$	—	$	(1,910	)

July 31, 2017:
Assets:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	583		$	—	$	583
Commodity derivatives	$	—	$	16,212		$	—	$	16,212
Liabilities:
Derivative financial instruments:
Interest rate swap agreements	$	—	$	(707	)	$	—	$	(707	)
Commodity derivatives	$	—	$	(1,258	)	$	—	$	(1,258	)

Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities (Tables)

12 Months Ended

Jul. 31, 2018

Fair Value of Financial Derivatives Balance Sheet Locations

The following tables provide a summary of the fair value of derivatives within Ferrellgas’ consolidated balance sheets as of July 31, 2018 and 2017:

July 31, 2018

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

17,123

Other current liabilities

1,832

Commodity derivatives-propane

Other assets, net

5,347

Other liabilities

Total

22,470

Total

1,910

July 31, 2017

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

11,061

Other current liabilities

415

Commodity derivatives-propane

Other assets, net

4,413

Other liabilities

Interest rate swap agreements

Prepaid expenses and other current assets

583

Other current liabilities

595

Interest rate swap agreements

Other assets, net

—

Other liabilities

112

Derivatives not designated as hedging instruments

Commodity derivatives-crude oil

Prepaid expenses and other current assets

738

Other current liabilities

828

Total

16,795

Total

1,965

Schedule of Derivative Collateral

The following tables provide a summary of cash margin balances as of July 31, 2018 and July 31, 2017, respectively:



	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net	927		Other liabilities	4,235
		$	3,778		$	16,543

	July 31, 2017
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	1,778	Other current liabilities	$	7,729
	Other assets, net	1,631		Other liabilities	3,073
		$	3,409		$	10,802

Fair Value Hedge Derivative Effect on Earnings

The following table provides a summary of the effect on Ferrellgas’ consolidated statements of comprehensive income for the years ended July 31, 2018, 2017 and 2016 due to derivatives designated as fair value hedging instruments:



		Amount of Gain Recognized on Derivative						Amount of Interest Expense Recognized on Fixed-Rated Debt (Related Hedged Item)
Derivative Instrument	Location of Gain Recognized on Derivative	For the year ended July 31,						For the year ended July 31,
		2018		2017		2016		2018			2017			2016
Interest rate swap agreements	Interest expense	$	266	$	1,319	$	1,919	$	(6,825	)	$	(9,100	)	$	(9,100	)

Cash Flow Hedge Derivative Effect on Comprehensive Income



	For the year ended July 31, 2018
				Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	30,231	Cost of product sold- propane and other gas liquids sales	$	24,714		$	—
Interest rate swap agreements	—		Interest expense	(395		)	—
	$	30,231		$	24,319		$	—



	For the year ended July 31, 2017
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	21,659		Cost of product sold- propane and other gas liquids sales	$	154		$	—
Interest rate swap agreements	866			Interest expense	(2,092		)	—
	$	22,525			$	(1,938	)	$	—

	For the year ended July 31, 2016
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	4,409		Cost of product sold- propane and other gas liquids sales	$	(24,438	)	$	—
Interest rate swap agreements	(2,620		)	Interest expense	(2,864		)	—
	$	1,789			$	(27,302	)	$	—

Derivatives not designated as hedging instruments effect on earnings



	For the year ended July 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(3,470	)	Cost of sales - midstream operations

	For the year ended July 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(425	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090		Operating expense

	For the year ended July 31, 2016
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	1,084		Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	(4,351		)	Operating expense

Changes in Derivative Value Effect on Other Comprehensive Income Loss

The changes in derivatives included in accumulated other comprehensive income (loss) (“AOCI”) for the years ended July 31, 2018, 2017 and 2016 were as follows:



	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2018			2017			2016
Beginning balance	$	14,648		$	(9,815	)	$	(38,906	)
Change in value on risk management commodity derivatives	30,231			21,659			4,409
Reclassification of (gains) and losses of commodity hedges to cost of product sold - propane and other gas liquids sales, net	(24,714		)	(154		)	24,438
Change in value on risk management interest rate derivatives	—			866			(2,620		)
Reclassification of (gains) and losses on interest rate hedges to interest expense	395			2,092			2,864
Ending balance	$	20,560		$	14,648		$	(9,815	)

Fair Value of Financial Derivatives Balance Sheet Locations

The following tables provide a summary of the fair value of derivatives within Ferrellgas, L.P.’s consolidated balance sheets as of July 31, 2018 and 2017:

July 31, 2018

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

17,123

Other current liabilities

1,832

Commodity derivatives-propane

Other assets, net

5,347

Other liabilities

Total

22,470

Total

1,910

July 31, 2017

Asset Derivatives

Liability Derivatives

Derivative Instrument

Location

Fair value

Location

Fair value

Derivatives designated as hedging instruments

Commodity derivatives-propane

Prepaid expenses and other current assets

11,061

Other current liabilities

415

Commodity derivatives-propane

Other assets, net

4,413

Other liabilities

Interest rate swap agreements

Prepaid expenses and other current assets

583

Other current liabilities

595

Interest rate swap agreements

Other assets, net

—

Other liabilities

112

Derivatives not designated as hedging instruments

Commodity derivatives-crude oil

Prepaid expenses and other current assets

738

Other current liabilities

828

Total

16,795

Total

1,965

Schedule of Derivative Collateral

The following tables provide a summary of cash margin balances as of July 31, 2018 and July 31, 2017, respectively:



	July 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	2,851	Other current liabilities	$	12,308
	Other assets, net	927		Other liabilities	4,235
		$	3,778		$	16,543

	July 31, 2017
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expense and other current assets	$	1,778	Other current liabilities	$	7,729
	Other assets, net	1,631		Other liabilities	3,073
		$	3,409		$	10,802

Fair Value Hedge Derivative Effect on Earnings

The following table provides a summary of the effect on Ferrellgas, L.P.’s consolidated statements of comprehensive income for the years ended July 31, 2018, 2017 and 2016 due to derivatives designated as fair value hedging instruments:



		Amount of Gain Recognized on Derivative						Amount of Interest Expense Recognized on Fixed-Rated Debt (Related Hedged Item)
Derivative Instrument	Location of Gain Recognized on Derivative	For the year ended July 31,						For the year ended July 31,
		2018		2017		2016		2018			2017			2016
Interest rate swap agreements	Interest expense	$	266	$	1,319	$	1,919	$	(6,825	)	$	(9,100	)	$	(9,100	)

Cash Flow Hedge Derivative Effect on Comprehensive Income



	For the year ended July 31, 2018
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	30,231		Cost of product sold- propane and other gas liquids sales	$	24,714		$	—
Interest rate swap agreements	—			Interest expense	(395		)	—
	$	30,231			$	24,319		$	—


	For the year ended July 31, 2017
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	21,659		Cost of product sold- propane and other gas liquids sales	$	154		$	—
Interest rate swap agreements	866			Interest expense	(2,092		)	—
	$	22,525			$	(1,938	)	$	—

	For the year ended July 31, 2016
					Amount of Gain (Loss) Reclassified from AOCI into Income
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI			Location of Gain (Loss) Reclassified from AOCI into Income	Effective portion			Ineffective portion
Commodity derivatives	$	4,409		Cost of product sold- propane and other gas liquids sales	$	(24,438	)	$	—
Interest rate swap agreements	(2,620		)	Interest expense	(2,864		)	—
	$	1,789			$	(27,302	)	$	—

Derivatives not designated as hedging instruments effect on earnings



	For the year ended July 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(3,470	)	Cost of sales - midstream operations

	For the year ended July 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	(425	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,090		Operating expense

	For the year ended July 31, 2016
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Reclassified in Income
Commodity derivatives - crude oil	$	1,084		Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	(4,351		)	Operating expense

Changes in Derivative Value Effect on Other Comprehensive Income Loss

The changes in derivatives included in accumulated other comprehensive income (loss) (“AOCI”) for the years ended July 31, 2018, 2017 and 2016 were as follows:



	For the year ended July 31,
Gains and losses on derivatives included in AOCI	2018			2017			2016
Beginning balance	$	14,648		$	(9,815	)	$	(38,906	)
Change in value on risk management commodity derivatives	30,231			21,659			4,409
Reclassification of gains and losses of commodity hedges to cost of product sold - propane and other gas liquids sales, net	(24,714		)	(154		)	24,438
Change in value on risk management interest rate derivatives	—			866			(2,620		)
Reclassification of gains and losses on interest rate hedges to interest expense	395			2,092			2,864
Ending balance	$	20,560		$	14,648		$	(9,815	)

Contingencies And Commitments (Tables)

12 Months Ended

Jul. 31, 2018

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]

The following provides the activity in the exit costs liability included in "Other liabilities" within the consolidated balance sheets:



	Contract exit costs
July 31, 2017	$	—
Net expense	11,804
Cash payments and other	—
July 31, 2018	$	11,804

Contractual Operating Lease Commitments And Buyouts

The following table summarizes Ferrellgas’ contractual operating lease commitments and buyout obligations as of July 31, 2018:



	Future minimum rental and buyout amounts by fiscal year
	2019		2020		2021		2022		2023		Thereafter
Operating lease obligations	$	42,356	$	33,137	$	26,142	$	19,173	$	13,867	$	16,624

Operating lease buyouts	$	3,884	$	3,131	$	3,526	$	6,035	$	3,527	$	8,540

Schedule of Restructuring Reserve by Type of Cost [Table Text Block]

The following provides the activity in the exit costs liability included in "Other liabilities" within the consolidated balance sheets:



	Contract exit costs
July 31, 2017	$	—
Net expense	11,804
Cash payments and other	—
July 31, 2018	$	11,804

Contractual Operating Lease Commitments And Buyouts

The following table summarizes Ferrellgas, L.P.’s contractual operating lease commitments and buyout obligations as of July 31, 2018:



	Future minimum rental and buyout amounts by fiscal year
	2019		2020		2021		2022		2023		Thereafter
Operating lease obligations	$	42,356	$	33,137	$	26,142	$	19,173	$	13,867	$	16,624

Operating lease buyouts	$	3,884	$	3,131	$	3,526	$	6,035	$	3,527	$	8,540

Net Earnings (Loss) Per Common Unitholders' Interest (Tables)

12 Months Ended

Jul. 31, 2018

Earnings Per Share [Abstract]

Earnings Distribution Allocation

In periods with undistributed earnings above certain levels, the calculation according to the two-class method results in an increased allocation of undistributed earnings to the general partner and a dilution of the earnings to the limited partners as follows.



	Ratio of total distributions payable to:
Quarterly distribution per common unit	Common unitholder		General partner
$0.56 to $0.63	86.9	%	13.1	%
$0.64 to $0.82	76.8	%	23.2	%
$0.83 and above	51.5	%	48.5	%

Basic And Diluted Net Earnings Per Common Unitholders' Interest

Additionally, in periods with net losses, there are no dilutive securities.



	For the year ended July 31,
	2018			2017			2016
Common unitholders’ interest in net loss	$	(252,035	)	$	(53,665	)	$	(658,761	)

Weighted average common units outstanding (in thousands)	97,152.7			97,229.5			98,682.8

Dilutive securities	—			—			—

Weighted average common units outstanding plus dilutive securities	97,152.7			97,229.5			98,682.8

Basic and diluted net loss per common unitholders’ interest	$	(2.59	)	$	(0.55	)	$	(6.68	)

Segment Reporting Segment Reporting (Tables)

12 Months Ended

Jul. 31, 2018

Reconciliation of Other Significant Reconciling Items from Segments to Consolidated

Following is a reconciliation of Ferrellgas' total segment performance measure to consolidated net earnings:



	Year Ended July 31,
	2018			2017			2016
Net loss attributable to Ferrellgas Partners, L.P.	$	(254,581	)	$	(54,207	)	$	(665,415	)
Income tax benefit	(2,678		)	(1,143		)	(36		)
Interest expense	168,467			152,485			137,937
Depreciation and amortization expense	101,795			103,351			150,513
EBITDA	13,003			200,486			(377,001		)
Non-cash employee stock ownership plan compensation charge	13,859			15,088			27,595
Non-cash stock-based compensation charge	—			3,298			9,324
Asset impairments	10,005			—			658,118
Loss on asset sales and disposals	187,399			14,457			30,835
Other income, net	(928		)	(1,474		)	(110		)
Change in fair value of contingent consideration	—			—			(100		)
Severance costs	1,663			1,959			1,453
Litigation fees and settlements	6,065			—			—
Acquisition and transition expenses	—			—			99
Unrealized (non-cash) loss (gains) on changes in fair value of derivatives	1,293			(3,457		)	1,137
Exit costs associated with contracts - Midstream dispositions	11,804			—			—
Net loss attributable to noncontrolling interest	(2,244		)	(294		)	(6,620		)
Adjusted EBITDA	$	241,919		$	230,063		$	344,730

Reconciliation of Assets from Segment to Consolidated

Following are total assets by segment:



	July 31,		July 31,
	2018		2017
Assets
Propane operations and related equipment sales	$	1,196,084	$	1,194,905
Corporate and other	167,197		415,064
Total consolidated assets	$	1,363,281	$	1,609,969

Profit Measure [Member]

Schedule of Segment Reporting Information, by Segment

Following is a summary of segment information for the years ended July 31, 2018, 2017 and 2016.



	Year Ended July 31, 2018
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,790,823	$	282,319		$	2,073,142
Direct costs (1)	1,514,755		316,468			1,831,223
Adjusted EBITDA	$	276,068	$	(34,149	)	$	241,919

	Year Ended July 31, 2017
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,463,574	$	466,703		$	1,930,277
Direct costs (1)	1,198,150		502,064			1,700,214
Adjusted EBITDA	$	265,424	$	(35,361	)	$	230,063

	Year Ended July 31, 2016
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,414,129	$	625,238		$	2,039,367
Direct costs (1)	1,127,382		567,255			1,694,637
Adjusted EBITDA	$	286,747	$	57,983		$	344,730

Capital Expenditures [Member]

Schedule of Segment Reporting Information, by Segment

Following are capital expenditures by segment (unaudited):



	Year Ended July 31, 2018
	Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance	$	23,979	$	3,584	$	27,563
Growth	51,229		1,255		52,484
Total	$	75,208	$	4,839	$	80,047

	Year Ended July 31, 2017
	Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance	$	13,330	$	3,808	$	17,138
Growth	28,912		315		29,227
Total	$	42,242	$	4,123	$	46,365

	Year Ended July 31, 2016
	Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance	$	13,487	$	3,390	$	16,877
Growth	32,906		63,152		96,058
Total	$	46,393	$	66,542	$	112,935

Reconciliation of Other Significant Reconciling Items from Segments to Consolidated

Following is a reconciliation of Ferrellgas, L.P.'s total segment performance measure to consolidated net earnings:



	Year Ended July 31
	2018			2017			2016

Net loss	$	(222,146	)	$	(29,059	)	$	(655,391	)
Income tax benefit	(2,699		)	(1,149		)	(41		)
Interest expense	133,946			127,188			121,818
Depreciation and amortization expense	101,795			103,351			150,513
EBITDA	10,896			200,331			(383,101		)
Non-cash employee stock ownership plan compensation charge	13,859			15,088			27,595
Non-cash stock-based compensation charge	—			3,298			9,324
Asset impairments	10,005			—			658,118
Loss on asset sales and disposals	187,399			14,457			30,835
Other income, net	(928		)	(1,474		)	(110		)
Change in fair value of contingent consideration	—			—			(100		)
Severance costs	1,663			1,959			1,453
Litigation fees and settlements	6,065			—			—
Acquisition and transition expenses	—			—			99
Unrealized (non-cash) loss (gains) on changes in fair value of derivatives	1,293			(3,457		)	1,137
Exit costs associated with contracts - Midstream dispositions	11,804			—			—
Adjusted EBITDA	$	242,056		$	230,202		$	345,250

Reconciliation of Assets from Segment to Consolidated

Following are total assets by segment:



	July 31,		July 31,
	2018		2017
Assets
Propane operations and related equipment sales	$	1,196,084	$	1,194,905
Corporate and other	167,162		415,043
Total consolidated assets	$	1,363,246	$	1,609,948

Ferrellgas, L.P. [Member] | Profit Measure [Member]

Schedule of Segment Reporting Information, by Segment

Following is a summary of segment information for the years ended July 31, 2018, 2017 and 2016.



	Year Ended July 31, 2018
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,790,823	$	282,319		$	2,073,142
Direct costs (1)	1,514,755		316,331			1,831,086
Adjusted EBITDA	$	276,068	$	(34,012	)	$	242,056

	Year Ended July 31, 2017
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,463,574	$	466,703		$	1,930,277
Direct costs (1)	1,198,150		501,925			1,700,075
Adjusted EBITDA	$	265,424	$	(35,222	)	$	230,202

	Year Ended July 31, 2016
	Propane operations and related equipment sales		Corporate and other			Total


Segment revenues	$	1,414,129	$	625,238		$	2,039,367
Direct costs (1)	1,127,382		566,735			1,694,117
Adjusted EBITDA	$	286,747	$	58,503		$	345,250

Ferrellgas, L.P. [Member] | Capital Expenditures [Member]

Schedule of Segment Reporting Information, by Segment

Following are capital expenditures by segment (unaudited):



	Year Ended July 31, 2018
		Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance		$	23,979	$	3,584	$	27,563
Growth		51,229		1,255		52,484
Total		$	75,208	$	4,839	$	80,047

	Year Ended July 31, 2017
		Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance		$	13,330	$	3,808	$	17,138
Growth		28,912		315		29,227
Total		$	42,242	$	4,123	$	46,365

	Year Ended July 31, 2016
		Propane operations and related equipment sales		Corporate and other		Total


Capital expenditures:
Maintenance		$	13,487	$	3,390	$	16,877
Growth		32,906		63,152		96,058
Total		$	46,393	$	66,542	$	112,935

Quarterly Data (Unaudited) (Tables)

12 Months Ended

Jul. 31, 2018

Summarized Unaudited Quarterly Data

The sum of basic and diluted net earnings (loss) per common unitholders’ interest by quarter may not equal the basic and diluted net earnings (loss) per common unitholders’ interest for the year due to variations in the weighted average units outstanding used in computing such amounts.



For the year ended July 31, 2018	First quarter			Second quarter			Third quarter		Fourth quarter
Revenues	$	454,655		$	755,156		$	515,810	$	347,521
Gross margin from propane and other gas liquids sales (a)	123,243			229,321			190,883		126,115
Gross margin from midstream operations (b)	12,635			10,209			8,077		(4,161		)
Net earnings (loss) (c)	(48,316		)	(1,774		)	11,062		(217,797		)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.	(47,915		)	(1,843		)	10,861		(215,684		)
Common unitholders’ interest in net earnings (loss)	(47,436		)	(1,824		)	10,752		(213,527		)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.49	)	$	(0.02	)	$	0.11	$	(2.20	)


For the year ended July 31, 2017	First quarter			Second quarter			Third quarter		Fourth quarter
Revenues	$	379,542		$	579,250		$	538,109	$	433,376
Gross margin from propane and other gas liquids sales (a)	123,187			202,346			171,950		126,774
Gross margin from midstream operations (b)	13,402			9,763			7,909		6,190
Net earnings (loss)	(43,471		)	38,528			6,691		(56,249		)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.	(43,073		)	38,098			6,536		(55,768		)
Common unitholders’ interest in net earnings (loss)	(42,642		)	37,717			6,470		(55,210		)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.44	)	$	0.39		$	0.07	$	(0.57	)


For the year ended July 31, 2016	First quarter			Second quarter			Third quarter		Fourth quarter
Revenues	$	471,146		$	649,238		$	509,472	$	409,511
Gross margin from propane and other gas liquids sales (a)	123,550			202,027			186,668		125,690
Gross margin from midstream operations (b)	40,066			39,890			33,572		40,476
Net earnings (loss) (c)	(80,566		)	57,755			18,918		(668,142		)
Net earnings (loss) attributable to Ferrellgas Partners, L.P.	(79,793		)	57,127			18,685		(661,434		)
Common unitholders’ interest in net earnings (loss)	(78,995		)	56,556			18,498		(654,820		)

Basic and diluted net earnings (loss) per common unitholders’ interest	$	(0.79	)	$	0.58		$	0.19	$	(6.68	)


(a)	Gross margin from “Propane and other gas liquids sales” represents “Revenues - propane and other gas liquids sales” less “Cost of sales – propane and other gas liquids sales.”


(b)	Gross margin from "Midstream operations" represents "Revenues - midstream operations" less "Cost of sales - midstream operations."


(c)	Includes asset impairment charges of $10.0 million in the second quarter of fiscal 2018 and $29.3 million and $628.8 million in the first and fourth quarters of fiscal 2016, respectively.